UK Supreme Court to hear case on parent company's responsibility for its subsidiary polluting local water sources in Zambia

On 15 and 16 January 2019, the UK Supreme Court will decide whether local people in Zambia can obtain compensation from a UK mining company, Vedanta Resources, for the pollution of local water sources by its Zambian subsidiary, Konkola Copper Mines. Vedanta Resources Plc and Another v Lungowe and others is brought by Leigh Day on behalf of over 1800 Zambian citizens who claim that it caused damages to their land and livelihoods.

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18 February 2019

UK lawsuit of Zambian farmers against Vedanta illustrates inequality of arms for people in poorer countries to hold multinationals to account, says expert

Author: Louise Eldridge, CORE Coalition, on Africa Is A Country

"The Zambian farmers who are suing a mining company in a British court", 15 Feb 2019

…In 2004, London-listed Vedanta Resources plc. acquired a 51% interest in Konkola Copper Mines (KCM), one of the most important Zambian state companies sold off to private investors. Vedanta now owns 80% of KCM…[which] is now one of Africa’s largest integrated copper producers with mines at three sites.

The UK case against Vedanta was brought in 2015 by 1,826 people (“Lungowe and others”)…[fighting] for justice for…devastation to their land and livelihoods through water pollution from KCM’s Nchanga copper mine.

In 2016, the UK High Court rejected Vedanta’s argument that the farmers should not be permitted to bring their case in London. The judge found that, despite recent reforms to the Zambian justice system, the claimants would not obtain justice if they pursued a case against KCM in Zambia. Two years later, following a further appeal from Vedanta, the Court of Appeal upheld the High Court ruling. Vedanta appealed again and on 15-16 January the case was heard at the Supreme Court.

The outcome of the Vedanta hearing hangs on whether the company arguably owes a duty of care to the Zambian claimants [when] in 2012 the Court of Appeal held that, under certain circumstances, a parent company could owe a legal duty of care to employees of its subsidiaries.

The claimants point to company documents…that they say show the parent company exercised an unusual level of control, direction and knowledge over KCM and should therefore be held legally responsible for the damage arising from the pollution. Vedanta’s lawyers, on the other hand, argue that the company’s UK headquarters is a separate legal entity with insufficient control over the Zambian subsidiary to be held liable…

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19 January 2019

The Vedanta Appeal, Corporate Liability and Access to Justice: Relevance for Myanmar?

Author: Business & Human Rights Burma

The claim against Vedanta, under review at the UK Supreme Court, will decide whether a UK-incorporated parent company has a duty of care, and therefore liability in tort law for negligence, to people affected by the operations of its subsidiary, Konkola Copper Mines (KCM), in Zambia…

Vedanta and KCM’s lawyers do not dispute the damage that has been done but have appealed to the Supreme Court arguing that their corporate structure does not give them enough control over KCM to give rise to this duty of care and that, in any case, the correct forum for the claims against KCM is the Zambian courts…

Essentially, the case must balance the interests of access to justice for victims of environmental and human rights law violations resulting in personal and property damage with opening the floodgates to claims against the subsidiaries of UK companies around the world in British courts…

In order for the villagers to make a claim against Vedanta in tort law, it must be shown that a duty of care exists, that the duty has been negligently breached, and that the breach has resulted in the damages…

The UK Supreme Court must know whether the duty of care in this situation extends extraterritorially, and if not, whether it is fair, just and reasonable to create a new duty of care…

So, what is the right forum to hear this type of claim? In English law, the appropriate forum is the one in which the case may most suitably be tried in the interests of all the parties and the ends of justice…

Vedanta’s lawyers sought to demonstrate that access to justice is obtainable in Zambian courts, citing various civil claims and reforms to the judiciary…

[The decision will have ramifications for access to justice for business-human rights and environmental abuses in all developing states, including Myanmar, where access to justice against subsidiary companies is limited and a potential claim could be made against the parent company in its home state...]

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16 January 2019

Vedanta tells top English court KCM pollution case should be heard in Zambia

Author: (Zambia)

Lawyers for Vedanta Resources told England’s Supreme Court on Tuesday that [the] case…should be heard in Zambia not London.

India-listed Vedanta, which delisted from London last year but maintains a legal base in Britain, is appealing a lower court ruling that a case in which villagers alleged their land was polluted by a Vedanta unit could be heard in England…

Vedanta’s legal team argued that Zambia was the “natural forum” for the case and said the parent company did not control operations in Zambia, which were governed by Zambian law…

London law firm Leigh Day has argued that the English courts were the only route for the villagers to achieve justice. 

Vedanta’s barrister Charles Gibson QC…said that Vedanta only agreed to provide KCM advisory services as an independent contractor and that its management agreement showed Vedanta did not have capacity to control KCM…

Vedanta’s case will also likely be watched by miner BHP, which has said it will fight an English suit by Brazilians seeking damages over an environmental disaster caused when the Fundao dam that stored mining waste burst in 2015.

Outside the court, action group Foil Vedanta was among those protesting against what they allege is pollution by Vedanta 

The case continues and A verdict is expected in April.

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14 January 2019

UK multinationals must respect human rights globally, UK Supreme Court is told

Author: International Commission of Jurists (ICJ) & Corporate Responsibility (CORE) Coalition

…The Court will consider evidence from human rights NGO the International Commission of Jurists (ICJ) and corporate accountability group CORE, that under existing law and international standards, Vedanta owes a legal duty of care to the Zambian villagers. Acceptance of this principle would make the merits of the case arguable before UK Courts and allow for their jurisdiction to hear the case in future proceedings…

The CORE and the ICJ submission to the Court argues that the Court of Appeal’s conclusion is supported by international standards on companies’ human rights and environmental responsibilities; UK government publications aimed at implementing those standards, including its Business & Human Rights Action Plan; and comparative law jurisprudence.

Vedanta has stated that its "sustainable development agenda" has been developed in line with the international standards to which the submission refers. These standards are therefore relevant to the factual question of whether Vedanta controlled and/or had assumed responsibility for the activities of its Zambian subsidiary, Konkola.

The case is a pivotal test for the development in the UK, and across common law and possibly other jurisdictions of parent company liability for human rights and environmental harm. Victims of corporate human rights abuses face multiple barriers in holding companies to account and securing access to justice. A clear statement from the UK Supreme Court affirming the duty of care principle would assist communities who have been harmed by corporate activities, and would provide an important affirmation of the scope of parent companies’ obligations.

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14 January 2019

Statement in Intervention in Vedanta Resources Plc and Another v Lungowe and others

Author: Corporate Responsibility (CORE) Coalition & International Commission of Jurists (ICJ)

The submission argues that the Court of Appeal's conclusion that Vedanta arguably owed the Claimants a duty of care is supported by:

(i) international standards regarding the responsibilities of business enterprises in relation to human rights and environmental protection;

(ii) material published by the UK government with the aim of implementing those international standards; and

(iii) comparative law jurisprudence.  

Vedanta has stated that its "sustainable development agenda" has been developed in line with the international standards to which the submission refers.

These standards are therefore relevant to the factual question of whether Vedanta controlled and/or had assumed responsibility for the activities of its Zambian subsidiary, Konkola

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14 January 2019

UK Supreme Court Hears Landmark Case on Corporate Rights Violations

Author: Rights and Accountability in Developments (RAID)

Companies have repeatedly used [the presumption that corporate entities within a group are distinct]…to avoid responsibility for the harm their business operations cause.

In the case of Vedanta Resources Plc and Another v Lungowe and others, the company denies that it exercised control over its Zambian subsidiary, KCM, or that it owes any duty of care to the Zambian victims whose livelihoods and health have been so badly affected by its mining operations.

The Zambian claimants argue that Vedanta, the parent company, did exercise control over KCM, and that in doing so owed them a duty of care.

The legal question of whether the parent company can be held accountable under civil law for human rights violations and environmental harm caused by its subsidiary is what the Supreme Court judges need to decide…

The UK, a signatory to key international human rights treaties, has a responsibility to advance access to justice for victims [which] frequently face significant obstacles to seeking justice in their home countries...

The UK Supreme Court decision in the Vedanta case will test whether Britain will keep up with, or even be at the forefront, of this trend, or whether it will prevent overseas human rights victims of British companies from seeking justice in the UK courts.

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9 January 2019

Landmark jurisdiction case to be heard in Supreme Court: UK mining company may be liable for pollution by Zambian subsidiary

Author: FoilVedanta

On 15th and 16th January 2019 the Supreme Court will hear Vedanta's second appeal against the High Court's jurisdiction ruling in the case of Dominic Liswaniso Lungowe vs Vedanta Resources and Konkola Copper Mines

The case could represent a precedent in UK law, as, if a duty of care is found to be owed by Vedanta towards the claimants, this would be the first reported case in which a parent company would have been held to owe a duty of care to a person affected by the operations of a subsidiary who is not an employee of the subsidiary…

In April 2016 a High Court ruling granted the claimants jurisdiction to have their case against KCM and Vedanta heard in the UK, citing KCM’s uncertain and opaque finances as one reason they may not be able to get justice in Zambia. The Court of Appeal upheld this verdict in July 2017…

A range of groups will join a protest outside the Supreme Court which has been called under the title 'Make Pollution Political'…Protesters…will decry this British company’s complete disregard for human rights and environment, and echo the community's demands for KCM to:

  • Stop polluting the rivers immediately. Close down the plant until pollution control measures are replaced and upgraded.
  • Provide clean water to the villages immediately, by tankers or pipes.
  • De-silt the Mushishima stream and Kafue River and remove contaminated waste.
  • Remediate the entire polluted area to make it safe to live, farm and fish there again.
  • Compensate the affected people for loss of health and livelihood. All medical costs should be paid by KCM/Vedanta in future.

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