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23 Feb 2021

Dr. Rachel Widdis, Trinity College Dublin on Business & Human Rights in Ireland Blog

Guest Post: Parent Companies’ Duty of Care: Cues for Ireland from the UK Supreme Court

In Okpabi v Shell, the UK Supreme Court affirmed that a parent company may owe a duty of care to communities negatively impacted by the operations of a foreign subsidiary, and advanced further. This case will now proceed for over 42,000 claimants from two communities in the Niger Delta alleging oil spillages have caused environmental damage affecting their livelihoods and health...

For Ireland, parallels may be drawn with eventual FDL cases, from a substantive perspective. Firstly, grounding jurisdiction turns on markedly similar tests and procedural provisions to Vedanta – Okpabi. Again, claimants must establish a ‘good cause of action’ and that the subsidiary is a ‘necessary and proper party’ to the claim. Arguably, Irish courts would also consider parent company duty of care as coherent with the circumstances in which a third party may be liable for the actions of another in Dorset. For example, the approach of Hogan J, as he then was, in Ennis commenced with reference to Dorset. It is to be hoped the Irish courts would explore the UK Supreme Court approach to control, intervention, and representations by a parent company concerning its subsidiaries. Similarly, in determining whether Ireland is the forum conveniens and connecting factors to the country where the harm impacts, they may give weight to practical impediments affecting whether justice would be available to the claimants there...