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Posts from ‘December, 2011’

Bloody nose for OFT in row over tobacco price-fixing

Tom Bawden Tuesday 13 December 2011

The Office of Fair Trading suffered a setback yesterday after a consortium of leading tobacco and retail groups overturned a previous ruling of unlawful pricing.

Imperial Tobacco, the maker of Golden Virginia rolling tobacco and Superkings, saw its £112.3m penalty reversed, and Co-op, Morrisons, Asda and Royal Dutch Shell were also successful in overturning their cases in front of the Competition Appeal Tribunal.

Imperial said it would now apply to recover its “considerable” legal costs. The case had alleged that two manufacturers and 10 retailers fixed prices on cigarettes, hand-rolled tobacco, pipe tobacco and cigars between 2001 and 2003, resulting in a total of £225m in fines last year, the biggest the consumer watchdog had levied.

The other manufacturer was Gallaher, a unit of Japan Tobacco, which did not appeal the OFT’s fine.

A spokesman for Imperial said: “The hearing by the Competition Appeal Tribunal was the first time since the OFT’s investigation began more than eight years ago that we were able to have its allegations independently reviewed.

“Under this independent scrutiny it became clear that the case the OFT was seeking to establish had no basis in fact, law or economics,” the spokesman added. Imperial’s lawyer, Euan Burrows of the Ashurst law firm, added that the OFT’s case was “deeply flawed”.

The move represents a further embarrassment for the OFT, less than a year after the fines it imposed upon the construction industry were cut by 89 per cent after a legal appeal.

An OFT spokeswoman said the watchdog “is disappointed and we’ll now be considering the judgment”.

J Sainsbury was a whistleblower in the investigation, providing evidence of the agreements to the OFT.

SOURCE ARTICLE

Shell Tanker ‘Capulonix’: Murder and cover-up on the high seas?

Shell Tanker ‘Capulonix’

By Alfred & John Donovan

An article on an alleged murder and cover-up, which allegedly took place on the Shell tanker ‘Capulnix’ many years ago, was republished yesterday on a Dutch website.

It therefore seem appropriate to republish our own article on the subject.

In 1974 it was reported that a Shell employee, Leo Rapmund (36), a crewmember on the Shell tanker, ‘Capulonix’, had gone missing, presumed lost overboard.

Over two decades later Rapmund’s family was contacted by a fellow crewmember at the time of the tragedy who wanted to clear his conscience about his knowledge of what really happened. Basically he revealed that Leo Rapmund had been murdered and there were many eyewitnesses to the crime.

The family claim that when they contacted Shell in 1995 with this alarming news, Shell and its lawyers (the most prestigious and expensive law firm in the Netherlands,  De Braauw, Blackstone & Westbroek) denied any knowledge or responsibility and treated them in a disgusting and arrogant manner. All responsibility and accountability were rejected. The family was fobbed-off like a bunch of nagging children.

In 2008, the family contacted the acclaimed Dutch investigative crime reporter Peter R. de Vries who has his own Emmy Award winning TV programme.  De Vries has been involved in a number of high profile cases including that of Natalee Holloway, the American student who mysteriously disappeared in 2005 while on a high school graduation trip to the Caribbean Island of Aruba.

De Vries approached Shell HQ in The Hague on 23 February 2009 and spoke with a senior Shell Public Relations official, Herman Kievits. His response was described as arrogant, at arms length and mainly on the lines that ‘we know nothing’.  The same holds true for the lawyers.

On 26 April 2009 Peter R. de Vries presented the case in his TV programme. Afterwards a number of viewers contacted Shell and expressed disgust at these cover-ups by the oil company.

The viewers who reacted towards Shell, all received a rather clumsy standard reaction with many half-truths. The facts however are totally different and in his unique manner Peter R. de Vries dissects all the nonsense by Shell and provides substantial evidence on what really happened. He tracked down a dozen witnesses of the murder. They all confirmed that Leo Rapmund had been in a fight on board and was shoved overboard. He managed to just hang on to the railing but his assailant had kicked his hands so long that he had to let go and disappeared forever in the waves. This act was unanimously described as ‘murder’. The witnesses were greatly surprised that they never have been formally heard nor summoned in a court case.

De Vries also makes mincemeat of all the statements by Shell and detailed evidence is provided on his website. He exposes Shell as a bunch of liars. In the end Shell even had to admit in a letter to him that they ‘did not know’ what happened to the assailant and why he had not been charged. Shell even did not know whether the man had been fired or not. That in itself is strange: on a tanker of Shell a Shell employee is literally kicked overboard by another Shell employee, but Shell subsequently never informs how all this has been handled in a legal matter.

Therefore it was nice that in the meantime aging offender is still alive. He told de Vries that the handling of the case also amazed him. After the incident he was taken from Singapore to the head office in Rotterdam. There he had to hand-over his passport and was sent home on extended leave. After half a year he was summoned again, received his passport back as well as six months of pay, was in a proper manner shown the door by Shell and subsequently signed on immediately with another company as a sailor. Done. Never heard anything anymore.

In his summary de Vries states:
It is simply embarrassing that Shell tried to blame the relatives of Leo that they all that time have not understood and that they more or less tried to misuse the situation for their own benefit.

De Vries points out that a multinational faced with such unfortunate circumstances can apologise and compensate the victims family or deny all allegations and NEVER admit to anything.  He concludes Shell is in the latter category behaving in a vicious and shameful manner.

After Leo Rapmund was killed, this is another form of character murder on the next of kin, which also remains unpunished. In that sense de Vries claims to have more respect for the aging assailant, who after so many years admits his act and honestly says he deserved prison. That Shell kicks the family and refrains from any form of an apology is a scandal. And it shows very clearly how the next biggest oil company of the world can be very small…..

The information comes from an article publish by Peter R. De Vries in Dutch. It includes reference to a long email to Shell setting out facts and evidence, which Shell ultimately agreed was basically correct.

http://www.peterrdevries.nl/

ARTICLE ENDS

The above article was sent in advance of publication to Mr Michiel Brandjes, Company Secretary and General Counsel, Royal Dutch Shell Plc. The relevant email is printed below. Since Shell chose not to reply on this occasion, we assume this is one of the  times when Shell decided the safest thing to do is to say nothing.

From: Alfred Donovan <alfred@shellnews.net>
Date: Thu, 21 May 2009 10:36:37 +0100
To: “michiel.brandjes@shell.com” <michiel.brandjes@shell.com>
Conversation: SHELL, DE HALVE WAARHEID EN DE DOOFPOT
Subject: SHELL, DE HALVE WAARHEID EN DE DOOFPOT

Dear Mr Brandjes

The draft article below is based on the article in Dutch recently published by Peter R. de Vries…

SHELL, DE HALVE WAARHEID EN DE DOOFPOT…. Shell, half the truth and the cover-up….

http://www.peterrdevries.nl/

The gist of the content was kindly provided by a Dutch Shell insider. Although not having time to provide a full translation, the draft does contain some translated passages.

Could you kindly point out any significant error of fact before I publish it? If Shell does not take issue with the facts as stated, then there is no need to reply. If I receive no response by 12 noon tomorrow UK time, I will assume that the information is true. If you need more time to check out matters, then kindly let me know when we can expect a response and we will take no further action until then.

If Shell is taking legal action challenging the facts, then please advise accordingly and we will await the outcome of any such litigation.

If you want to supply for publication with the article any related comment by Shell, we will happily publish it on an unedited basis.

This is an important story which deserves publication in the English language.

Regards
Alfred Donovan

UPDATE

We have been contacted by a close relative of the murder victim.  Extracts from the relevant self-explanatory email correspondence, which contains an appeal for information, is printed below.

Hello,

My name is Cynthia Erne’.  Leo Rapmund was my Uncle.  When he was killed I was 12 years old.  My Mother is Louise (Rapmund) VanDenEikhof, and was Leo’s sister. I had only recently found out all this information about his murder; I like the rest of the family never really understood what happened. I believe my Mother just feels too powerless to pursue anything with Shell, much to my dismay; but I wanted to thank you for your article and will continue to thank everyone who worked to bring this to light. I had been with my Uncle only a few times since we lived in the United States, but his visits were such fun, I could never forget him.

It has bothered me that nothing was done on behalf of our family, but my Grandmother has passed away, and my Aunt Emmeke passed away last year.  I would certainly like the contact information for the attorney in the US that handled the Shell case with Wiwa.  I personally am not one to let things rest, so I decided that if there is something that can be done, I would like to pursue it.

Consequently, if anyone has information on this matter kindly send it to me direct at: cfritzen2000@yahoo.com

Thank you again Alfred.

EMAIL ENDS

Some of the Capulonix crew in 1974…

Oil cyber-attacks could cost lives, Shell warns

12 December 2011

The oil industry has been warned that cyber-attacks could “cost lives” and cause “huge damage”.

Ludolf Luehmann, an IT manager for Shell, told the World Petroleum Conference in Doha that the company had suffered an increased number of attacks.

He said the hacks had been motivated by both commercial and criminal intent.

Security researcher David Emm said that such attacks were “not only possible, but they’re now real”.

Mr Luehmann said Shell and others in the industry were experiencing a “new dimension” of attack which could leave physical machinery at serious risk.

He made reference to Stuxnet, a targeted “worm” which was designed to attack industrial systems in the summer of 2010.

Mr Luehmann said Stuxnet showed energy giants that cyber-attacks could have a real-world consequence on business processes.

“If anybody gets into the area where you can control opening and closing of valves, or release valves, you can imagine what happens.

“It will cost lives and it will cost production, it will cost money, cause fires and cause loss of containment, environmental damage – huge, huge damage.”

He added: “We see an increasing number of attacks on our IT systems and information and there are various motivations behind it – criminal and commercial.”

Dramatic change

When contacted by the BBC, Shell said it would not comment further on Mr Luehmann’s statements.

BP, itself a target of high-profile cyber-attacks following the Gulf oil spill, said it did not speak publicly about security issues as a matter of company policy.

Dennis Painchaud, director of international government relations at Canadian energy company Nexen, said targeted attacks such as Stuxnet and the more recent threat Duqu form a “very significant risk to our business”.

“Cybercrime is a huge issue. It’s not restricted to one company or another – it’s really broad and it is ongoing.

“It’s something that we have to stay on top of every day. It is a risk that is only going to grow and is probably one of the pre-eminent risks that we face today and will continue to face for some time.”

Moscow-based security experts Kaspersky, said the past 18 months had seen a dramatic change in how cyber-threats were perceived by large companies.

“The scene used to be dominated by speculative attacks – people being at the wrong place at at the wrong time, but it was nothing personal,” Mr Emm told the BBC.

“But we certainly are in a different world than where we were 18 months ago. What we’re starting to see is an increase in targeted attacks. We know critical systems, like those in oil production, are vulnerable to attack.

“A lot of countries now are pumping money into research – the last 18 months have shown these people are after not just the public’s money, but they’re after larger organisation’s information.

“Organisations like Shell and others are hopefully taking steps to minimise that risk.”

SOURCE ARTICLE

Middle East can expect ‘dash for gas’, Shell exec tells Oman conference

Muscat, Oman (Platts)–12Dec2011/609 am EST/1109 GMT

Shell anticipates a dash for gas in the Middle East to cope with increasing energy demand and expectations that some 60 million people are due to enter its jobs market over the next ten years.

The forecast came from Mark Carne, Shell’s Executive Vice President for the Middle East and North Africa, addressing the Gas Arabia conference in Muscat Monday.

He was backed in this view by BP’s Chief Economist Christof Ruehl, who said that on a global basis, other fuels will continue to grow over the next 20 years, but gas will grow much faster than any other. He noted that BP’s current Energy Outlook to 2030 anticipates an average annual growth for natural gas consumption of 2.1%.

“As Middle East markets such as Kuwait and Dubai import increasing volumes of LNG, I believe it will spark a new interest in gas exploration in the region,” Carne said. “We anticipate a dash for gas in the region and further development of existing resources,” he added.

Carne argued that although gas should play a central role in meeting the energy requirements that lie ahead, the local supply train should contribute more to the gas industry in the region.

He said 90% of the personnel at Shell’s joint ventures in the Middle East and North Africa were nationals of the countries in which they work, “but our supply chains are nowhere near this level of local content.”

“We need to re-think local content; we need to re-engineer our supply chains to enhance and sustain in-country value,” he added.

He tied this to both the need to provide more jobs in the region and as a way of helping answer the question of whether governments would undertake gas development in the region in partnership with IOCs or on their own.

Carne said: “In the next decade, the working population will increase by about 60 million people. So the challenge to government and business is how to create six million jobs a year.”

This meant there was both a real need for major gas projects in region and also an opportunity for more efficient use of gas, he added.

However, when Ruehl discussed energy efficiency, he argued that “the one thing we know about system efficiency is that improvement comes when prices go up. It rarely comes from moral imprecations, which often backfire.”

He added: “I know people don’t like to hear it — it is a function of price more than anything.”

Carne argued that while the region offered opportunities, not least through elimination of gas flaring, it could take a decade to develop its deep sour gas reservoirs.

Both speakers stressed the role of unconventional gas, with Carne noting that unconventional gas is being tested by Petroleum Development Oman in Oman.

Carne expected regional gas consumption to rise 60% in the next decade, with the demand for gas, both regionally and globally, fueled by its availability, affordability and relative environmental acceptability.

The arrival of LNG and unconventional gas would have a profound impact on gas pricing, Ruehl argued. Even pipeline deliveries will be delivered at market prices, he said. In the short term, pipelines will be tied to long-term prices but in the long term, “if there is a enough supply, we will see flexibility extending from LNG markets into pipelines, changing pricing systems even in pipelines.”

Carne said: “For countries importing gas as LNG, you can’t expect to achieve anything other than international pricing. As LNG starts to flow, you are still going to have to compete and pay international prices.”

–John Roberts, john_roberts@platts.com

SOURCE ARTICLE

Similar stories appear in Oilgram News. See more information at http://www.platts.com/Products/oilgramnews

Big role for gas in global energy mix

LETTER FROM MALCOLM BRINDED (RIGHT) PUBLISHED BY THE FINANCIAL TIMES

From Mr Malcolm Brinded.

Sir, Jürgen Grossman, RWE’s chief executive, makes some important points in articulating the scale of the challenge involved in reducing the carbon footprint of energy production (“Germany faces ‘Herculean’ task with move to renewables”, Special Reports, Energy, December 5). But reconciling economic growth and climate change is not a straight choice between nuclear and renewables. As a result of recent major increases in the global estimates of natural gas resources, energy policymakers should now be confident that they can count on abundant, affordable and acceptable natural gas today and for many decades to come. This is why Angela Merkel is right when she outlines a central role for gas in Germany’s new energy future.

Chancellor Merkel’s analysis should resonate across Europe and the rest of the world. Over the next 40 years, the world will need twice as much energy, but with half the carbon emissions. The simplest, fastest and cheapest way to achieve this will be for gas to displace coal in power generation in the next 20 years. Europe has the potential to lead the world here, because switching to gas-fired power generation would cut emissions now.

Modern gas-fired power plants emit approximately 50 per cent less carbon dioxide than coal plants. Europe is within economic distance of 70 per cent of the world’s gas reserves and has a well-established gas infrastructure. What’s more, a switch to gas wouldn’t come at the expense of renewable energy. Fear among non-governmental organisations and politicians that a stronger focus on natural gas will lock in another generation of fossil fuel plants – and drive out investment in renewables – misses the point. The flexibility of gas power is the natural complement to the intermittency of renewables.

And as for historic security of supply concerns, we now see many new countries exporting gas, plus much increased capacity to import liquefied natural gas into Europe – all of which creates a much more resilient supply situation.

Governments and regulators worldwide must acknowledge, welcome and encourage the role that gas can play in the future energy mix, through energy and power market policies that properly recognise the CO2 benefits, reliability and flexibility of gas power.

7 December 2011

Malcolm Brinded, Executive Director, Upstream International Royal Dutch Shell, London SE1, UK

SOURCE

Getting Gas Drilling Right

A version of this editorial appeared in print on December 12, 2011, on page A22 of the New York edition

After several crowded and often raucous hearings, Gov. Andrew Cuomo agreed to give the public until Jan. 11 to comment on 2,000 pages of environmental analysis and proposed regulations designed to govern natural gas drilling in deep shale formations in New York State. The extension makes sense. The drilling decision is a momentous one, for the environment and the economy, and it is vitally important to get it right.

The issue is not the fuel. There is little doubt in our minds that natural gas, which is cheap, plentiful and cleaner than coal, could help greatly with the country’s energy and climate problems.

The question is whether it can be safely extracted by a technique called hydraulic fracturing, which involves blasting water, sand and chemicals deep into rock formations to dislodge the gas. Done carelessly, the technique poses threats to water quality, local landscapes and the atmosphere that other states, including Pennsylvania, have failed to address adequately.

That’s where the rules from the state’s Department of Environmental Conservation come in. They must establish detailed safeguards for hydraulic fracturing and ensure regulatory oversight. The proposed rules have been months in the making but still need to be improved to better protect the environment and public health. Here are several concerns:

URBAN WATER SUPPLIES The rules rightly forbid drilling inside the two major unfiltered watersheds serving New York City and Syracuse. But New York City officials warn that hydrofracturing outside the watershed boundaries could set off tiny subsurface shocks, cracking the aging tunnels that bring water to the city and allowing water to leak out of the tunnels and gas to seep in. The proposed rules would limit drilling within 1,000 feet of the tunnels; some experts believe that a setback of several miles will be necessary.

HAZARDOUS WASTEWATER A federal panel found recently that the biggest risks arise from “flowback” — the huge volumes of water laced with naturally occurring toxic pollutants that drilling brings to the surface along with the natural gas. In Western states, these and other wastes are sometimes safely stored underground, but this may not be possible in New York’s geological formations. Sewage treatment plants are not equipped to handle these wastes, open pits are out of the question, and surface storage — even in airtight steel tanks — may be no more than a temporary solution. State officials concede that they don’t have an answer, but until they do, not a single well should be drilled.

OVERSIGHT When fully operational in a decade, the industry could be drilling hundreds of wells a year. Two questions arise, neither addressed in the proposed regulations: First, who’s going to police all this activity? The minerals division of the Department of Environmental Conservation has fewer than 20 employees. Joe Martens, the commissioner, says he wants 140 more, but even that doesn’t sound like enough. Second, who’s going to pay for the regulatory machinery? The obvious answer is the industry, which is growing rapidly and can easily afford permit fees or a volumetric tax on the gas or both. The state needs to ensure an adequate financing stream dedicated to monitoring and enforcement.

There are other issues that need meticulous examination. One is the danger of underground leaks of chemicals or methane gas. The Environmental Protection Agency reported on Thursday that wells in a remote valley in Wyoming may have been contaminated this way. Another issue is above-ground gas leaks that would add to global warming (methane is a potent greenhouse gas). Still another is what industry should be required to do to restore the landscape to its original condition after wells go dry.

There is no reason to hurry the rule-making or the drilling. The only way New York can safely move ahead with hydrofracturing is by designing and executing a tough regulatory program that could also serve as a model for the rest of the nation.

Related

Related in Opinion

Sale Of Oil Block OPL 245 By Malabu To Shell & Agip

Letter Of Complaint Regarding Sale Of Oil Block OPL 245 By Malabu To Shell & Agip

December 11, 2011

By Ademola Williams

Dear Sirs: On the 7th of December 2011 various news papers internationally and local published a report that Royal Dutch Shell and Eni said on Wednesday they have bought the prospective Nigerian deep offshore oil block OPL 245: these reports were given to all the various news outlets by Shell and ENI (Agips parent company), Shell, Eni buy Nigeria’s controversial OPL 245

As a concerned Nigerian, I urge the House Committee on Upstream Petroleum, to investigate the approval of the above Oil license and sale to Shell & Agip by DPR and the Ministry of Petroleum; and consider the transfer of ownership to Shell and Agip as illegal; in addition to revert the said oil block to its previous status and only allow such oil block to be sold to parties who fit the requirement of the oil blocks initial license. Which says that no foreign company can directly or indirectly buy more than 40% of the oil block.

The Oil block was sold to Shell & Agip by Malabu oil and Gas Ltd. the original license holder of OPL 245 for the sum of $1.3 billion USD plus a signatory Bonus of $210 million USD. The issue at hand is that OPL 245 is an oil block first issued to Malabu Oil and Gas Ltd in 1998 under the indigenisation program to boost local participation in the oil and gas industry.  The Block was later issued a 2005 PSC still under the indigenisation program; please read the attached out of court settlement document made by the Ministry of Petroleum Resources dated 2nd December 2006.

Over the years several oil licenses have been issued under the indigenisation program to various local oil companies, all those companies had to comply with the rules of the license. In the above case why should an exemption be given to Malabu, Shell and Agip by DPR and the Petroleum Ministry? Why if Malabu wanted to sell shares in the oil block they did not comply with the license and sell only 40% of the interest? Also why did DPR on this case feel it was necessary and in the interest of Nigeria to change the license and allow the sale of 100% of the oil block to two Multinational oil companies, one (Shell) who is being investigated in its participation in the Killing of people in the Niger Delta? I am also aware that the President appointed a new head at DPR who was a Vice President of Shell International, is this not a gross conflict of interest?

I assert as a Nigerian that Malabu, Shell and Agip including the Government of Nigeria should play by the rules of the game. If not why should other companies holding oil blocks under the indigenous program not be allowed to change their licenses? Further I for see huge legal problems in future where other companies will take the government to court and also request damages in the 100`s of millions for not allowing them to change their licenses as was allowed in the OPL 245 situation.

I kindly request the House to investigate the sale of this OPL 245 License by the Ministry of Petroleum Resources & DPR and also freeze all funds transferred by the buyers. This transaction also smells of gross corruption which possibly includes bribery by all parties involved. Does the Nigerian Government have the conscience to do the right thing?

SOURCE: SAHARA REPORTERS

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Analysis: Business hides behind corporate veil on human rights abuse claims

Attempts by Royal Dutch Shell, the parent company, to argue the charges should not be levelled at the ‘mother company’ but its Nigerian subsidiary prompted an 18 month delay to the proceedings. Royal Dutch lost that argument in December 2009.  But it hasn’t given up the fight – requests by prosecutors to access relevant information from the parent company have recently been blocked in the Dutch courts.

December 9th, 2011 | by

People living in the Niger Delta where land and rivers are indelibly polluted after decades of oil extraction have long suffered violations of several internationally recognised human rights.

These rights comprise the right of access to food, work, an adequate standard of living, health and a healthy environment.

Environmental degradation has wrecked farming and fishing livelihoods in the Delta on a massive scale. This was confirmed by the United Nations Environment Programme in August when it called for an initial $1bn fund to clean up oil related pollution.

Three years prior to the UN’s detailed study, in May 2008, four Nigerian fishermen and farmers from the Delta villages of Oruma, Goi and Ikot Ada Udo filed several lawsuits against Royal Dutch Shell in the district court of the Hague where the oil giant has its international headquarters.

The villagers alleged Shell was negligent in its clean-up of oil spills.  They claimed their health was adversely affected as a result. Shell argues that a recent preliminary court ruling stated that all the spills under the spotlight were caused by sabotage.

This keenly watched case, expected to be heard in the Hague next year, is a lesson in how corporate ownership structures can affect legal redress in alleged human rights violations.

Attempts by Royal Dutch Shell, the parent company, to argue the charges should not be levelled at the ‘mother company’ but its Nigerian subsidiary prompted an 18 month delay to the proceedings.

Royal Dutch lost that argument in December 2009.  But it hasn’t given up the fight – requests by prosecutors to access relevant information from the parent company have recently been blocked in the Dutch courts.

Corporate secrecy
For campaigners seeking greater economic transparency it seems the problems of corporate secrecy and difficulties establishing who owns what are now entering the human rights arena.

Human rights defenders say parent companies often try to counter cases against them by arguing that claims should be brought against the operating company. They say that it is the subsidiary – where the alleged violation took place – that is at fault, not them.

‘This is not about avoidance,’ stated a Shell spokesman. ‘It is about who is legally responsible. Like most corporate groups, Shell’s corporate structure is determined by normal business considerations.’

For those seeking redress against alleged wrong-doing, prosecuting a subsidiary company though is problematic.

Potential claimants in developing countries are often unable to hold that company to account for three reasons.

Firstly, legal systems in developing countries often find it hard to manage lengthy and complicated cases. Secondly the subsidiary in the developing country may not have enough cash to meet the size of financial claims. And finally, developing countries may be unwilling to hold a corporation to account due to complicity or corruption.

That said, developed countries also have a history in preventing sensitive cases from being heard. Witness the UK government’s decision in 2006 to end an investigation into alleged bribery and false accounting in BAE’s arms deals with Saudi Arabia.

The challenge of human rights defenders is best summed up in one phrase: piercing the corporate veil.

The corporate veil is a term given by human rights lawyers in their attempt to pin liability on the parent companies of major corporations.

Andie Lambe, head of the international justice at Global Witness, said: ‘Very few of the alleged abuses committed or facilitated by companies ever make it to court for a variety of reasons. One of these is that the structure of the corporation protects it from liability.’

Professor Sheldon Leader, director of the Essex University Business and Human Rights Project, added: ‘What Shell has said to the Netherlands’ judiciary – and it will be important to see how far other major companies argue the same – is that they do have high standards but they do not give orders to subsidiaries. Therefore, they argue, they are not responsible for damage to local populations due to the shortcomings in their subsidiaries’ performance.’

Take profits, not responsibility
Companies may not admit to legal responsibility of their subsidiaries when difficulties arise but they certainly take responsibility for the cash they generate. When companies publish financial reports, subsidiaries are inextricably linked to the parent. Consolidated accounts, by definition, embrace the thousands, if not millions of transactions conducted by all subsidiaries in which the owner has a beneficial interest.

What’s more, quoted companies in the US and UK stock exchanges are obliged to reveal all the subsidiaries they either own outright or have substantial stakes in which are considered to be materially important.

Clearly in financial reporting, a link between the parent and subsidiary is manifest. Yet company law treats every business entity as legally separate, even within the same ‘business family’. And this is where difficulties arise in seeking to hold a parent company accountable even in instances where it knew of or supported the conduct of its subsidiary.

To remedy this, a corporate ‘duty of care’ principle needs to be established which states that in the event of a parent financially benefitting from a subsidiary, it has a responsibility to ensure the subsidiary carries out duties in line with established laws. When the subsidiary fails to live up to required standards, the parent has to face legal liability – and not  hide behind a corporate veil.

This article is also published in the Guardian.

SOURCE ARTICLE

CNPC Relies on Shell, Exxon Mobil to Develop Chinese Shale Gas

December 08, 2011, 10:58 AM EST

By Wael Mahdi

Dec. 8 (Bloomberg) — China National Petroleum Corp. will rely on help from Royal Dutch Shell Plc and Exxon Mobil Corp. amongst others to develop its shale gas resources.

CNPC is working with Shell on a project in central China to develop shale gas, its president Zhou Jiping told reporters today in Doha, Qatar. The company has already made shale gas discoveries and it needs more time to develop them, he said.

“The tectonic movement in China is even stronger than in the U.S., and it’s making the structure more complex,” he said. China has more potential gas resources than the U.S., according to his estimates.

Chinese gas shale development will be more complex than in the U.S. because of a different geological formation, he said.

–Editors: Stephen Cunningham, Alex Devine.

To contact the reporter on this story: Wael Mahdi in Cairo at wmahdi@bloomberg.net

To contact the editor responsible for this story: Stephen Cunningham at scunningha10@bloomberg.net

SOURCE ARTICLE

DOCTORING THE INTERNET

The company also said it had a team which ‘sorts’ negative Wikipedia coverage of clients.

Daily Mail, Wednesday, December 7, 2011 Page 12

Main article: Call to probe lobbying firm ‘that boasted of its access to Cameron’ By Jason Groves, Political Correspondent

Secondary article published under the headline: DOCTORING THE INTERNET

LOBBYISTS claim knowledge of ‘all sorts of dark arts’ that could help corporations and foreign regimes boost their reputations on the internet.

Executives from Bell Pottinger told undercover reporters that they could set up bigus internet blogs to ‘drwown out’ criticism.

They also claimed they could use sophisticated techniques to bury bad news stories on Google by moving them down the search results page.

The company also said it had a team which ‘sorts’ negative Wikipedia coverage of clients.


EXTRACT FROM RELATED ARTICLE BY JOHN DONOVAN PUBLISHED IN OCTOBER 2010

Headline: Ku Klux Klan culture at Wikipedia: secrecy and censorship

“As the founder of MyWikiBiz, I am someone who has, and continues to, manipulate information in Wikipedia on behalf of paying clients. Call it dirty work, but for the most part, I think the way the Wikimedia Foundation is scamming the public about how it is (not) governing the world’s “knowledge” is a far worse state of affairs.” (SEE COMMENT AT FOOT OF ARTICLE BELOW)

By John Donovan

Money is said to be the root of all evil. I have no doubt that it is undermining the integrity and balance of some Wikipedia articles corrupted by parties who have a financial interest in the content.

Wikipedia articles are supposedly written by open and transparent consensus. In reality Wikipedia is built on a platform of secrecy and concealment which leaves articles wide open to censorship and manipulation by anonymous parties with commercially driven motives. Since Wikipedia has articles covering major commercial enterprises, money enters the equation.

Unpaid volunteers who act as administrators and editors are supposedly the bedrock on which Wikipedia has been built. It is a mostly-secretive community in which the vast majority of volunteers edit using aliases and are free to edit any articles, without anyone having a clue about who they are and what their background is. Thus it is impossible to determine if they have a potential conflict of interest.

The Wikipedian’s using aliases are also able to comment of the editing work of other contributors and vote on the deletion of Wikipedia articles.

So there is a lot of power and influence and no realistic accountability. If, due to some transgression, a Wikipedian is banned from editing, they can return under a new alias using a new IP address, with no bad odor attached. In other words, a completely fresh start.

The strange “Wikipedian” culture has some similarity to the Ku Klux Klan (fortunately without the racist element) but is actually more secretive. The privacy of those choosing to keep secret all information about who they are is maintained within the Wikipedia community, which is even developing its own language, partly in response to skulduggery by some editors.

There are Wikipedia articles about every major business. A company is not permitted to edit any articles about the company. BP for example cannot edit Wikipedia articles about BP.

Because of the huge popularity of Wikipedia, the content of a Wikipedia article about a business is important because it can have a positive or negative impact on the reputation of the business. This in turn can impact on its value.

Previously it was a major exercise to carry out research about the track record of a company stretching back to its inception. Now it is, or at least should be, instantly and freely accessible via the Internet to the public and investors. And Wikipedia is the main online source of such information.

Businesses are therefore rightly concerned about the content of Wikipedia articles about them.

I have been an editor of Wikipedia articles for the last four years. I am aware of the difference between writing a blog on my own website and making edits on Wikipedia. I have always strived to operate within Wikipedia guidelines. This includes ensuring that information added is neutral, accurate, and can be verified by reference to a cited independent reputable source. In other words information written without bias on the part of the editor. Most of my contributions have related to Royal Dutch Shell.

From the outset I openly declared my name and background. I have already pointed out that the vast majority of contributors choose to conceal their identities and background by using a pseudonym, as they are fully entitled to do under Wikipedia guidelines. As we will see, a Wikipedian who chooses to declare their name and background is at a disadvantage to those opting to conceal that information.

CONFLICT OF INTEREST

From the start, some Wikipedian’s operating under alias names have challenged me over an alleged conflict of interest. I have repeatedly invited anyone to produce evidence to support that contention i.e. where I have added my own words which display a bias. No one has ever provided any such evidence.

I received a tip off informing me of the identity of a Wikipedian using an alias “BozMo” who had nominated the royaldutchshellplc.com Wikipedia article for deletion. “BozMo” turned out to be Andrew Cates, a former CEO of a Royal Dutch Shell company. Mr Cates is mentioned in the “Related Articles” – links below.

I am retired from business and have always operated websites on an entirely non-commercial basis, including royaldutchshellplc.com. I have no litigation in progress or pending with Shell.

Inevitably people who have some connection with Shell or an interest in Royal Dutch Shell are the people most likely to edit Royal Dutch Shell related Wikipedia articles. I know that people associated with Shell, including Mr Cates, have monitored and/or contributed to the articles.

So when does a connection with Shell amount to a potential conflict of interest in editing a Wikipedia article about the company? Are Shell shareholders to be banned on that basis? Or former Shell employees? Or people who have campaigned against Shell?

Surely the simple test is whether a personal biased point of view is being expressed, as opposed to factual information supported by verifiable evidence from an independent reputable source. If properly sourced factual information is assembled under a particular heading, say “Controversies surrounding Royal Dutch Shell“, then that does not make the article biased.

CENSORSHIP

By coincidence or otherwise, in a short period of time, under the guise of various alleged issues, Wikipedia is being systematically cleansed of negative, but true, properly sourced verifiable information about Shell. Articles have already been deleted by a handful of anonymous censors reaching a consensus.

This aroused my suspicions because: -

1. I know that Royal Dutch Shell management is obsessed with my Wikipedia editing/contributions. Among the documents Shell has been legally obliged to supply to me are several Shell internal documents and emails, some marked confidential, which discussed my editing on Wikipedia and the possible impact on shareholders and students. There was also discussion about the risk of Shell being caught if it tried to edit the material.

2. Editing of the articles was made from Shell premises. This was detected by WikiScanner.

3. When Shell has dirty work in mind, it is often passed on to a third party, thereby distancing Shell from actions taken by the third party. Shell HAS hired a third party agency specializing in reputation clean up on the Internet. I have the evidence. There are many such agencies.

4. There is information freely available on the Internet providing a blueprint of how to infiltrate Wikipedia utilizing the policy which permits concealment of identity and background. It advises on a stratagem of deception to disguise true intent. This includes editing a wide range of articles to avoid being identified as a one topic contributor. It discusses implications relating to IP addresses. The objective being for an organized group of infiltrators to edit target articles without detection. I will not go into detail for obvious reasons.

CONCEALING IDENTITY

It is impossible to make any judgment about possible conflict of interest by contributors using an alias, because unless they reveal their real name and background, there is no information to check. However, Wikipedian’s who choose to remain anonymous can from that sheltered position use background information freely disclosed by individuals editing under their own names, to cast doubt on their bona fides. The person who has been completely open, is at a disadvantage.

Although Wikipedia etiquette requires editors/contributors to act in a civil way towards one another when discussing issues which inevitable arise, the fact that people can hide behind an alias means that they sometimes adopt a dictatorial aggressive and even bullying tone that they would never use under their real name. I have noticed a great difference between dialogue with individuals using an alias and dialogue with the same persons after they have disclosed their real identity. The tone changes completely.

Unfortunately it is impossible to judge in such circumstances who is genuine and who is not. I assume that the vast majority are genuine, but unfortunately a minority are not. And you also have the unedifying spectacle of a person who is open and honest having their integrity publicly impugned by someone choosing to hide behind an alias.

People sheltering behind an alias may not be immune from libel action, but it makes it far less likely that anyone will attempt to sue them, because it would obviously entail first finding out their real identity. This is likely to involve legal action against a third party if a third party published their comments. Again, the person choosing to be open is at a disadvantage.

Operating on the current basis means there is not a level playing field between those you choose to be open and those who prefer secrecy, which is an option, not compulsory. I have already pointed out how easy it is to switch to a new identity.

As a result of the strenuous efforts by a handful of dedicated people apparently on a mission, the information about Royal Dutch Shell on Wikipedia has been transformed. Negative accurate information supported by newspaper articles, government agency publications, court documents etc has vanished. Instead we have a collection of sanitized information about Royal Dutch Shell which could have been written by or on behalf of Shell media.

The Wikipedia article royaldutchshellplc.com was nominated for deletion again just over a week ago by the same anonymous party involved in all of the recent deletions of negative factual articles relating to Royal Dutch Shell. When the vote consensus was to keep the article, that decision was deemed unacceptable and the voting period has been extended, presumably until the desired outcome is achieved. The current article in place for over a year with minor changes, was not authored by me.

It cannot be right for Wikipedia articles about other major oil companies to contain balanced information – the positive and the negative – while masses of accurate, properly sourced, unbiased information about Royal Dutch Shell has been removed solely because the information is negative in nature. It is censorship on an industrial scale by parties unknown.

Commonsense suggests that anyone who wishes to edit a Wikipedia article in which monetary considerations are involved should be compelled to disclose their identity and background so that the information can be exposed to public scrutiny. Otherwise it is only a matter of time before the culture of subterfuge and deception at Wikipedia results in a scandal.

Because of certain related matters, I am considering taking legal action against Wikipedia (which has been duly notified). Whether such an action will be practical remains to be seen.

COMMENT RECEIVED

thekohser on Oct 12th, 2010 at 5:11 pm

As the founder of MyWikiBiz, I am someone who has, and continues to, manipulate information in Wikipedia on behalf of paying clients. Call it dirty work, but for the most part, I think the way the Wikimedia Foundation is scamming the public about how it is (not) governing the world’s “knowledge” is a far worse state of affairs.I’m soon to publish a book about Wikipedia and business:
http://www.mywikibiz.com/Directory:Your_Business_and_Wikipedia

Gregory Kohs is a marketing research director for a Fortune 100 media company. His enterprise, MyWikiBiz, has been the subject of news stories appearing in USA Today, the Washington Post, and MSNBC.com. He has appeared on national television and has presented “how to” information about Wikipedia to academic audiences. His experience with MyWikiBiz and Wikipedia has been documented in numerous books and scholarly works.

FURTHER RELATED ARTICLES

Royal Dutch Shell Wikipedia Machinations: 29 March 2010

Wikipedia Klan exposed: 13 October 2010

Instant reaction on Wikipedia: 13 October 2010