Milieudefensie v Royal Dutch Shell

Last updated

Milieudefensie et al v Shell
State coat of arms of the Netherlands.svg
CourtDistrict court of The Hague
Decided26 May 2021 (2021-05-26)
ECLI ECLI:NL:RBDHA:2021:5337
Transcript(s) ECLI:NL:RBDHA:2021:5339(English)
Court membership
Judge(s) sittingLarisa Alwin, Irene Kroft and Michiel Harmsen
Case opinions
The policy, policy intentions and ambitions of Royal Dutch Shell* (hereafter Shell) are incompatible with Shell's reduction obligation. The claimed order to comply with that obligation must be allowed. The order is declared provisionally enforceable.
  • After losing in the Hague District Court, Shell dropped "Royal Dutch" from its name, and moved its headquarters to London.[15]

Milieudefensie v Royal Dutch Shell (2021) is a human rights law and tort law case heard by the district court of The Hague in the Netherlands in 2021 related to efforts by several NGO's to curtail carbon dioxide emissions by multinational corporations. It was brought by the Dutch branch of Friends of the Earth and a group of other NGO's against the oil corporation, Shell plc. In May 2021, the court ordered Shell to reduce its global carbon emissions from its 2019 levels by 45% by 2030, relating not only to the emissions from its operations, but also those from the products it sells. It is considered to be the first major climate change litigation ruling against a corporation.

Contents

Facts

Following the global adoption of the Paris Agreement in 2015, which aimed to limit the rise in the global average temperature to under 1.5 °C through various milestones at 2050, large corporations operating in signatory countries began evaluating if they could alter operations to meet the targets of the Agreement. The British multinational Shell is one of the largest oil and gas companies in the world; its headquarters are in the United Kingdom since 2022. Shell is the ninth-largest corporate contributor to global pollution, producing about 2.5% of global emissions. [1] [2] As the Paris Agreement was being developed, Shell evaluated its businesses to determine what it could do to address emissions, but had stated in 2014 that it believed that the Paris targets were unattainable and did not plan to change its business model away from oil and gas. [1] Following the signing of the Agreement, Shell issued a statement that it would address its CO2 emissions, releasing a plan that called for reductions of its carbon dioxide emissions by 30% by 2035, compared to 2016 levels, and by 65% by 2050. [1] So far, in 2022 only 1,5 % of the investments of Shell are to be used for renewables (wind and solar power generation), and with current investment trends Shell's carbon emissions are expected to rise with 4% up to 2030 compared to 2019 levels

In order to safeguard the temperature limit set out in the Paris Agreement, global carbon emissions to decrease with 45% in 2030. Given the clear gap between Shell's plans and the targets of the Paris Agreement, seven environmental organisations foundations Milieudefensie (the Dutch branch of Friends of the Earth), Greenpeace, Fossielvrij, Waddenvereniging, Both ENDS, Jongeren Milieu Actief, and ActionAid  – and 17,379 individual claimants in the Netherlands filed a class-action lawsuit against Shell in April 2019, arguing that Shell should change its business model to reach an emissions reduction target of 45% by 2030 in line with the Paris Agreement. [1] [3] By failing to change, the plaintiffs argued, Shell had failed to uphold the unwritten duty of care laid down in Book 6 Section 162 of the Burgerlijk Wetboek (Dutch Civil Code) as well as articles 2 and 8 of the European Convention on Human Rights. [1] [4] [5] Shell stated in response to the summons that it was doing its part to address climate change, and that "What will accelerate the energy transition is effective policy, investment in technology and changing customer behaviour. None of which will be achieved with this court action. Addressing a challenge this big requires a collaborative and global approach." [1]

Hearings at the district court at The Hague were held in December 2020. The plaintiffs were required under Dutch law to demonstrate that a viable alternative business model existed for Shell to achieve the suggested 45% reduction goal, and had used the recent transformation of Danish company Ørsted from fossil fuels to renewables as a viable example. [1] During the trial, Shell issued a pledge in February 2021 to be net-zero by 2050. [6] Plaintiffs considered Shell's pledge to be inadequate as the company would still fail to meet the Paris Agreement goals. [7]

Judgment

The Hague District Court orderd that Shell's current sustainability policy was insufficiently "concrete", and that its emissions were greater than that of most countries. [7] Due to these factors, the court ordered that Shell must indeed reduce its global emissions by 45% by 2030 compared to 2019 levels; the reduction targets include emissions from its operations and products. [2] The court declared the order provisionally enforceable, meaning that the order has immediate effect, even if one of the parties appeals the ruling. [7] [8] [9]

The Court said the following:

... every emission of CO2 and other GHGs, anywhere in the world and caused in whatever manner, contributes to this [environmental] damage and its increase” (insertion added) and that “the (…) circumstance that RDS [Royal Dutch Shell, the respondent] is not the only partly responsible for tackling dangerous climate change (…) does not absolve RDS of its individual partial responsibility to contribute to the fight against dangerous climate change according to its ability.

Significance

The case was considered a landmark ruling in environmental law related to climate change: while previous lawsuits against governments have prevailed for enforcing a more effective climate policy, this was considered the first major lawsuit to hold a corporation to the tenets of the Paris Agreement. [7] As such, it contributes to the growing field of climate litigation. While the decision only has jurisdiction in the Netherlands, [10] although pertaining to Shell's global operations, it could set a precedent for other environmental lawsuits against other large companies with high emissions that have not taken sufficient steps to reduce their emissions. [11] [12] The impact of the court's decision was considered by legal experts to be strengthened due to its reliance on human rights standards and international measures on climate change. [2] [7] [13]

Shell appealled the ruling. The hearings of the appeal case are not yet scheduled. [2] [14]

After losing in the Hague District Court, Shell dropped "Royal Dutch" from its name, and moved its headquarters to London. [15] It said the choice was not due to losing the case.

See also

Notes

  1. 1 2 3 4 5 6 7 Boffey, Daniel (30 November 2020). "Shell in court over claims it hampered fossil fuels phase-out". The Guardian . Archived from the original on 17 May 2021. Retrieved 26 May 2021.
  2. 1 2 3 4 Boffey, Daniel (26 May 2021). "Court orders Royal Dutch Shell to cut carbon emissions by 45% by 2030". The Guardian . Archived from the original on 26 May 2021. Retrieved 26 May 2021.
  3. "Milieudefensie dagvaardt Shell in rechtszaak om uitstoot". NOS Nieuws (in Dutch). 5 April 2019. Archived from the original on 27 May 2021. Retrieved 10 December 2021.
  4. Burgerlijk Wetboek - Book 6 Section 162 Archived 27 May 2021 at the Wayback Machine
  5. "Climate change actions against corporations: Milieudefensie et al. v. Royal Dutch Shell plc". Clifford Chance . 13 January 2021. Archived from the original on 19 January 2021. Retrieved 10 December 2021.
  6. Ambrose, Jillian (11 February 2021). "Shell to expand gas business despite pledge to speed up net zero carbon drive". The Guardian . Archived from the original on 24 May 2021. Retrieved 26 May 2021.
  7. 1 2 3 4 5 Brian, Stuart (26 May 2021). "Shell ordered to reduce CO2 emissions in watershed ruling". Deutsche Welle . Archived from the original on 26 May 2021. Retrieved 26 May 2021.
  8. ECLI:NL:RBDHA:2021:5337 (Dutch)
  9. ECLI:NL:RBDHA:2021:5339 (English)
  10. "Shell: Netherlands court orders oil giant to cut emissions". BBC . 26 May 2021. Archived from the original on 26 May 2021. Retrieved 26 May 2021.
  11. MacFarlene, Sarah (26 May 2021). "Shell ordered by Dutch Court to cut carbon emissions". The Wall Street Journal . Archived from the original on 26 May 2021. Retrieved 26 May 2021.
  12. Corder, Mike (26 May 2021). "Court orders Royal Dutch Shell to cut net emissions by 45%". Associated Press. Archived from the original on 26 May 2021. Retrieved 26 May 2021 via The Washington Post.
  13. Zindy, Hanna (26 May 2021). "Court orders Shell to slash CO2 emissions in landmark climate ruling". CNN . Archived from the original on 26 May 2021. Retrieved 26 May 2021.
  14. "Reactie Shell op uitspraak klimaatzaak / Shell response to climate case verdict". shell.com. Royal Dutch Shell. 26 May 2021. Archived from the original on 27 May 2021. Retrieved 26 May 2021. We will continue to focus on these efforts and fully expect to appeal today's disappointing court decision
  15. T Wilson, 'Shell investors back moving HQ from Netherlands to UK' (10 December 2021) Financial Times

Related Research Articles

<span class="mw-page-title-main">Climate change mitigation</span> Actions to reduce net greenhouse gas emissions to limit climate change

Climate change mitigation is action to limit climate change. This action either reduces emissions of greenhouse gases or removes those gases from the atmosphere. The recent rise in global temperature is mostly due to emissions from burning fossil fuels such as coal, oil, and natural gas. There are various ways that mitigation can reduce emissions. These are transitioning to sustainable energy sources, conserving energy, and increasing efficiency. It is possible to remove carbon dioxide from the atmosphere. This can be done by enlarging forests, restoring wetlands and using other natural and technical processes. The name for these processes is carbon sequestration. Governments and companies have pledged to reduce emissions to prevent dangerous climate change. These pledges are in line with international negotiations to limit warming.

<span class="mw-page-title-main">Greenhouse gas emissions</span> Sources and amounts of greenhouse gases emitted to the atmosphere from human activities

Greenhouse gas (GHG) emissions from human activities intensify the greenhouse effect. This contributes to climate change. Carbon dioxide, from burning fossil fuels such as coal, oil, and natural gas, is one of the most important factors in causing climate change. The largest emitters are China followed by the United States. The United States has higher emissions per capita. The main producers fueling the emissions globally are large oil and gas companies. Emissions from human activities have increased atmospheric carbon dioxide by about 50% over pre-industrial levels. The growing levels of emissions have varied, but have been consistent among all greenhouse gases. Emissions in the 2010s averaged 56 billion tons a year, higher than any decade before. Total cumulative emissions from 1870 to 2017 were 425±20 GtC from fossil fuels and industry, and 180±60 GtC from land use change. Land-use change, such as deforestation, caused about 31% of cumulative emissions over 1870–2017, coal 32%, oil 25%, and gas 10%.

<span class="mw-page-title-main">Greenhouse gas emissions by the United States</span> Climate changing gases from the North American country

The United States produced 5.2 billion metric tons of carbon dioxide equivalent greenhouse gas (GHG) emissions in 2020, the second largest in the world after greenhouse gas emissions by China and among the countries with the highest greenhouse gas emissions per person. In 2019 China is estimated to have emitted 27% of world GHG, followed by the United States with 11%, then India with 6.6%. In total the United States has emitted a quarter of world GHG, more than any other country. Annual emissions are over 15 tons per person and, amongst the top eight emitters, is the highest country by greenhouse gas emissions per person. However, the IEA estimates that the richest decile in the US emits over 55 tonnes of CO2 per capita each year. Because coal-fired power stations are gradually shutting down, in the 2010s emissions from electricity generation fell to second place behind transportation which is now the largest single source. In 2020, 27% of the GHG emissions of the United States were from transportation, 25% from electricity, 24% from industry, 13% from commercial and residential buildings and 11% from agriculture. In 2021, the electric power sector was the second largest source of U.S. greenhouse gas emissions, accounting for 25% of the U.S. total. These greenhouse gas emissions are contributing to climate change in the United States, as well as worldwide.

<span class="mw-page-title-main">Paris Agreement</span> 2015 international treaty on climate change

The Paris Agreement, often referred to as the Paris Accords or the Paris Climate Accords, is an international treaty on climate change. Adopted in 2015, the agreement covers climate change mitigation, adaptation, and finance. The Paris Agreement was negotiated by 196 parties at the 2015 United Nations Climate Change Conference near Paris, France. As of February 2023, 195 members of the United Nations Framework Convention on Climate Change (UNFCCC) are parties to the agreement. Of the three UNFCCC member states which have not ratified the agreement, the only major emitter is Iran. The United States withdrew from the agreement in 2020, but rejoined in 2021.

<span class="mw-page-title-main">Climate change in Europe</span> Emissions, impacts and responses of Europe related to climate change

Climate change has resulted in an increase in temperature of 2.3 °C (2022) in Europe compared to pre-industrial levels. Europe is the fastest warming continent in the world. Europe's climate is getting warmer due to anthropogenic activity. According to international climate experts, global temperature rise should not exceed 2 °C to prevent the most dangerous consequences of climate change; without reduction in greenhouse gas emissions, this could happen before 2050. Climate change has implications for all regions of Europe, with the extent and nature of impacts varying across the continent.

<span class="mw-page-title-main">Ben van Beurden</span> Dutch businessman

Bernardus Cornelis Adriana Margriet "Ben" van Beurden is a Dutch businessman who was the CEO of Shell plc from 2014 to 2022. He joined Shell in 1983, after earning a master's degree in chemical engineering from Delft University of Technology, Netherlands.

<span class="mw-page-title-main">Climate change in Germany</span> Emissions, impacts and responses of Germany related to climate change

Climate change is leading to long-term impacts on agriculture in Germany, more intense heatwaves and coldwaves, flash and coastal flooding, and reduced water availability. Debates over how to address these long-term challenges caused by climate change have also sparked changes in the energy sector and in mitigation strategies. Germany's energiewende has been a significant political issue in German politics that has made coalition talks difficult for Angela Merkel's CDU.

<span class="mw-page-title-main">Climate change in France</span> Emissions, impacts and responses of France related to climate change

In France, climate change has caused some the greatest annual temperature increases registered in any country in Europe. The 2019 heat wave saw record temperatures of 46.0 °C. Heat waves and other extreme weather events are expected to increase with continued climate change. Other expected environmental impacts include increased floods due to both sea level rise and increased glacier melt. These environmental changes will lead to shifts in ecosystems and affect local organisms. Climate change will also cause economic losses in France, particularly in the agriculture and fisheries sectors.

<span class="mw-page-title-main">Climate change litigation</span> Use of legal practice to further climate change mitigation

Climate change litigation, also known as climate litigation, is an emerging body of environmental law using legal practice to set case law precedent to further climate change mitigation efforts from public institutions, such as governments and companies. In the face of slow politics of climate change delaying climate change mitigation, activists and lawyers have increased efforts to use national and international judiciary systems to advance the effort. Climate litigation typically engages in one of five types of legal claims: Constitutional law, administrative law, private law (challenging corporations or other organizations for negligence, nuisance, etc., fraud or consumer protection, or human rights.

<span class="mw-page-title-main">Special Report on Global Warming of 1.5 °C</span> Special climate change report published by the Intergovernmental Panel on Climate Change

The Special Report on Global Warming of 1.5 °C (SR15) was published by the Intergovernmental Panel on Climate Change (IPCC) on 8 October 2018. The report, approved in Incheon, South Korea, includes over 6,000 scientific references, and was prepared by 91 authors from 40 countries. In December 2015, the 2015 United Nations Climate Change Conference called for the report. The report was delivered at the United Nations' 48th session of the IPCC to "deliver the authoritative, scientific guide for governments" to deal with climate change. Its key finding is that meeting a 1.5 °C (2.7 °F) target is possible but would require "deep emissions reductions" and "rapid, far-reaching and unprecedented changes in all aspects of society". Furthermore, the report finds that "limiting global warming to 1.5 °C compared with 2 °C would reduce challenging impacts on ecosystems, human health and well-being" and that a 2 °C temperature increase would exacerbate extreme weather, rising sea levels and diminishing Arctic sea ice, coral bleaching, and loss of ecosystems, among other impacts.

Carbon pricing in Canada is implemented either as a regulatory fee or tax levied on the carbon content of fuels at the Canadian provincial, territorial or federal level. Provinces and territories of Canada are allowed to create their own system of carbon pricing as long as they comply with the minimum requirements set by the federal government; individual provinces and territories thus may have a higher tax than the federally mandated one but not a lower one. Currently, all provinces and territories are subject to a carbon pricing mechanism, either by an in-province program or by one of two federal programs. As of April 2023 the federal minimum tax is set at CA$65 per tonne of CO2 equivalent, set to increase to CA$170 in 2030.

<span class="mw-page-title-main">Greenhouse gas emissions by China</span> Emissions of gases harmful to the climate from China

China's greenhouse gas emissions are the largest of any country in the world both in production and consumption terms, and stem mainly from coal burning, including coal power, coal mining, and blast furnaces producing iron and steel. When measuring production-based emissions, China emitted over 14 gigatonnes (Gt) CO2eq of greenhouse gases in 2019, 27% of the world total. When measuring in consumption-based terms, which adds emissions associated with imported goods and extracts those associated with exported goods, China accounts for 13 gigatonnes (Gt) or 25% of global emissions.

<span class="mw-page-title-main">Climate target</span> Policy for emissions reductions

A climate target, climate goal or climate pledge is a measurable long-term commitment for climate policy and energy policy with the aim of limiting the climate change. Researchers within, among others, the UN climate panel have identified probable consequences of global warming for people and nature at different levels of warming. Based on this, politicians in a large number of countries have agreed on temperature targets for warming, which is the basis for scientifically calculated carbon budgets and ways to achieve these targets. This in turn forms the basis for politically decided global and national emission targets for greenhouse gases, targets for fossil-free energy production and efficient energy use, and for the extent of planned measures for climate change mitigation and adaptation.

<i>State of the Netherlands v. Urgenda Foundation</i> Dutch court case about carbon dioxide emissions

State of the Netherlands v. Urgenda Foundation was a court case heard by the Supreme Court of the Netherlands in 2019 related to government efforts to curtail carbon dioxide emissions. The case was brought against the Dutch government in 2013, arguing the government, by not meeting a minimum carbon dioxide emission-reduction goal established by scientists to avert harmful climate change, was endangering the human rights of Dutch citizens as set by national and European Union laws.

<span class="mw-page-title-main">Climate change in the Netherlands</span> Emissions, impacts and responses of the Netherlands related to climate change

The Netherlands is already affected by climate change. The average temperature in the Netherlands rose by more than 2 °C from 1901 to 2020. Climate change has resulted in increased frequency of droughts and heatwaves. Because significant portions of the Netherlands have been reclaimed from the sea or otherwise are very near sea level, the Netherlands is very vulnerable to sea level rise.

This is an environmental history of the 2020s. Environmental history refers to events and trends related to the natural environment and human interactions with it. Examples of human-induced events include biodiversity loss, climate change and holocene extinction.

This article documents events, research findings, scientific and technological advances, and human actions to measure, predict, mitigate, and adapt to the effects of global warming and climate change—during the year 2021.

<i>Lliuya v RWE AG</i>

Lliuya v RWE AG (2015) Case No. 2 O 285/15 is a German tort law and climate litigation case, concerning liability for climate damage in Peru from a melting glacier, against Germany's largest coal burning power company, RWE, which has caused approximately 0.47% of all historic greenhouse gas emissions. It is currently on appeal in the Upper State Court, Oberlandesgericht Hamm.

Neubauer v Germany 1 BvR 2656/18 is a landmark German constitutional law case, concerning the duty of the German federal government to take action to prevent climate damage.

<i>Smith v Fonterra Co-operative Group Ltd</i>

Smith v Fonterra Co-Operative Group Ltd [2021] NZCA 552 is a New Zealand tort law case, concerning liability of major fossil fuel polluters for climate damage.