In 2021, a landmark case was decided in the Netherlands holding that Shell plc (formerly Royal Dutch Shell plc) owed a duty of care under Dutch tort law to reduce its CO2 emissions by 45% by 2030 compared to 2019 levels. This case was one of the first major wins for climate litigants and helped usher in a global wave of climate litigation. Shell initially signaled that it would comply with the court’s order, but soon after changed their stance to a “wait and see” approach pending the outcome of an appeal. Recently, that appeal was decided largely in favor of Shell. Greenberg Traurig discusses the decision in a recent memo stating:
“The Court of Appeal concluded that, notwithstanding Shell’s responsibility to reduce greenhouse gas emissions, a civil court cannot impose specific emissions reduction targets on the company. Specifically for scope 1 and 2 emissions, the court considered that Shell is already working towards meeting the goals Milieudefensie requested. For scope 3 emissions, the court noted that there is currently insufficient scientific consensus on what precise reduction percentage should apply to individual companies like Shell.”
The silver lining is that the appeals court agreed that under Dutch tort law companies do owe a duty of care to reduce their greenhouse gas emissions. However, the court stopped short of allowing the judiciary to set emissions reduction targets for companies. Additionally, the decision all but throws out court oversight over a company’s Scope 3 emissions, arguing that even if Shell were to stop selling fossil fuels, another company would pick up their market share and continue to sell just as many fossil fuel products. Plaintiffs will have a chance to appeal the case again to the Dutch Supreme Court, but any final ruling could be years away.
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Image Credit: Alexandr Blinov – stock.adobe.com
