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UPDATE 2-Court rules Shell can't be sued in London for Nigeria oil spills

Thu, 26th Jan 2017 16:26

* Shell not liable for subsidiary's actions

* Claimants can bring case in Nigerian courts

* Nigerian villagers will appeal decision (Adds ruling details, comments, background)

By Karolin Schaps and Libby George

LONDON, Jan 26 (Reuters) - Royal Dutch Shell cannotbe sued in London over oil spills in Nigeria, the High Courtruled on Thursday, in a setback to attempts to hold Britishmultinationals liable at home for their subsidiaries' actionsabroad.

Villagers from the Bille and Ogale communities in theoil-producing Niger Delta in southern Nigeria had said they wereaffected by pollution and had sought to take action againstShell in London rather than its subsidiary in Nigeria.

If the High Court had ruled in favour of the claimants,others could have been encouraged to pursue legal action againstBritish-based multinationals through the British courts, legalexperts have said.

The court ruled that Shell, as the parent company, does nothave legal responsibility for its Nigerian subsidiary, ShellPetroleum Development Company of Nigeria (SPDC), which isjointly operated with the Nigerian government.

The judge, Justice Fraser, said: "There is simply noconnection whatsoever between this jurisdiction and the claimsbrought by the claimants, who are Nigerian citizens, forbreaches of statutory duty and/or in common law for acts andomissions in Nigeria, by a Nigeria company."

The court also said the claimants should be able to useNigerian courts, which are now delivering quicker verdicts.

The villagers argued that Nigerian courts were unfit to heartheir case, but Shell said the matter was a uniquely Nigerianissue and should be heard there.

Leigh Day, the law firm representing the villagers, saidthey would appeal against the ruling.

"My clients are very confident they will succeed in anappeal," said Leigh Day partner Daniel Leader, who alsorepresented Nigeria's Bodo community in another oil spill claimagainst Shell that ended in a $55 million settlement in 2015.

Igo Weli, SPDC's general manager for external relations,said the firm hoped "the strong message sent by the Englishcourt today ensures that any future claims by Nigeriancommunities concerning operations conducted in Nigeria will beheard in the proper local courts".

Shell also denies responsibility for the spills, which itsays were due to sabotage and illegal refining.

Activists said the judgment would unfairly allow Shell toavoid responsibility for its subsidiary's actions.

"This is an unfair judgement. What has happened in London isthat Shell has been given power to do whatever with impunity inNigeria," said Celestine Akpobari, an activist in Ogaliland,where the claimants come from.

Last year, the High Court ruled that a case brought byZambian villagers against mining company Vedanta Resources over environmental pollution could be heard in England.

Vedanta has appealed the ruling. (Additional reporting by Tife Owolabi in Yenagoa; editing bySusan Thomas, Adrian Croft and Giles Elgood)

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