The case is about the environmental group Milieudefensie/Friends of the Earth suing the Royal Dutch Shell for failing to play its part in the fight against climate change and thereby breaching its duty of care under Dutch law and human rights obligations.
Established in 1971, Milieudefensie is the Netherland’s most influential climate organization. Since 1972, it has been a member of Friends of the Earth International, the largest grassroots environmental network on an international level . Shell, previously known as Royal Dutch Shell , is an Anglo-Dutch multinational and one of the largest oil and gas companies worldwide and in consequence one of the biggest corporate producers of greenhouse gases .
In 2019, Mileudefensie together with other NGOs and the signatures of more than 17.000 citizens, started a lawsuit against Shell arguing that Shell has an obligation to contribute to the prevention of climate change on basis of the duty of care under the unwritten standard of the Dutch Civil Code, Book 6 Section 162 and the Paris Climate Agreement of 2015. In line with these legal foundations, they demanded that Shell reduce its emissions by 45% by 2030 - compared to the 2019 level - and use its great influence to provide consumers with more sustainable choices. According to Milieudefensie, Shell had known the dangerous effects of the company’s emissions for decades and failed to take appropriate action up to the present time .
Shell defended itself by giving mainly two arguments: First, they argued that cutting out further emissions would not have any effect because those emissions would be replaced by other companies due to the EU Emissions Trading System (ETS). Second, Shell argued that there was no legal basis for the company to be sued for its emissions and that the plaintiff’s arguments were too general in order to fall within the scope of the European Convention on Human Rights (ECHR) .
On May 26 in 2021, The Hague District Court ruled that Shell had to reduce its emissions by 45% by 2030 across emissions from its own operations and effects of the company’s produced oil. According to the court, this decision was made on the basis of the duty of care under the unwritten standard of the Dutch Civil Code and the Paris climate goals .
As of today, Shell has not taken any action to further reduce its emissions in line with the court's decision. It should also be mentioned that the company moved their headquarters from the Netherlands to the UK, even though the company denies any relation of the relocation to the court’s judgment but explains it mainly with the 15% dividend tax that the Dutch government puts on big multinationals . In April 2022, Milieudefensie sent a letter to the company's board of directors asking for urgent action. Shell, for its part, appealed against the court's decision in June 2022, and it remains to be seen what the outcome of this conflict will be . However, it raises the broader question of whether private companies can be held responsible for taking appropriate action on climate change and liable for failing to do so.