FINGER IN THE DYKE
Climate activists have welcomed a judgment in the Netherlands — a country particularly vulnerable to rising sea levels — ordering Shell to sharply cut its emissions. But will the ruling have broader ripples?
The Netherlands is among the most progressive nations in the world. The country’s lenient approach to the use of soft drugs such as cannabis, for example, started back in the 1970s. In 1981 it was the first country to legalise same-sex marriage, and in 1999 it was one of the first to decriminalise prostitution. Euthanasia and assisted suicide have been legal there since 2002.
So it’s perhaps unsurprising that a district court in The Hague handed down an order to Royal Dutch Shell last week ordering the multinational to slash its CO² emissions — including those from the combustion of oil and gas products by its customers — by 45% within nine years.
It’s a landmark ruling. Shell is, after all, the largest oil and gas company on the planet after Saudi Aramco, and the judgment marks the first time that a company will be forced to comply with such a broad emissions target — and do so in a way that is likely to fundamentally change its business model.
The ruling could have far-reaching implications for the oil and gas industry worldwide, and has been met with exaltation by the climate-concerned community.
Because a substantive part of the decision relies on the duty of care — a moral or legal obligation to ensure the safety or wellbeing of others — civil society groups are optimistic that the ruling creates a strong precedent for similar litigation in future.
For all the excitement, though, Prof Dire Tladi, the National Research Foundation’s SA research initiative chair for international constitutional law, says the judgment is of limited application.
“This is a Dutch district court, not even the supreme court,” he tells the FM. “More importantly, it’s clearly applying Dutch law.”
Notably, the ruling is focused specifically on the conduct of Royal Dutch Shell as the entity exists in the Netherlands (though, as a parent company, it does set policies for its subsidiaries around the world).
“The second limitation is that, even though the broader harm that [the ruling is] speaking to is climate change, the court itself makes its decision based on the harm that can be suffered in the Netherlands and surrounding regions,” says Tladi.
“Of course, scientifically, you can’t make the distinction between where the harm and climate change actually occurs. But it seems to me the court is saying this harm will affect the Netherlands, and therefore, it has jurisdiction.”
Though the impact for now is only on Dutch law, Tladi believes the judgment will, over time, have global repercussions. It’s no coincidence that the ruling was written in English, he notes — the court knew it could have widespread significance.
Martha Bradley, a specialist in public international law and international humanitarian law at the University of Pretoria, says the case may well become important when it comes to interpreting the Paris Agreement on climate change, an international treaty to which SA is a signatory.
The law of interpreting treaties is codified in the Vienna Convention on the law of treaties and applies to all states, Bradley says.
Under the convention, “subsequent practice” may be used as a tool of interpretation. This occurs when signatories interpret a treaty in a common or consistent manner. The manner of that common interpretation, she notes, could effectively modify a treaty.
So if signatories were to interpret the Paris Agreement along the lines of the Dutch ruling, there could be a substantial knock-on effect.
However, the threshold for subsequent practice is very high, says Bradley: “All states party to the Paris Agreement will have to follow the same interpretation to allow for the determination of emission targets for nonstate actors such as Shell. Time will therefore tell if other states will follow this example.”
Perhaps complicating matters around a broader agreement on interpretation is that the scene for the ruling by the court in The Hague was already set by the Dutch Climate Act, which seeks a reduction of greenhouse gas emissions in the Netherlands to a level that will be 95% lower in 2050 than in 1990. Few other states are as ambitious. In SA, for example, the Climate Bill is yet to be transformed into legislation, she says.
On an international level, “law changes very slowly”, says Tladi. “But judgments like this can help propel it — particularly when it relates to an issue like this, where people have been speaking about it a lot.”
In a written response to the ruling, Shell provided a long list of efforts to transition its business to become a net zero-emissions energy company by 2050. It also says it intends to appeal the “disappointing court decision”.
It’s no coincidence that the Dutch ruling was written in English — the court knew it could have widespread implications