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Dutch Court Clears Obstacle To Dutch Prosecution Of Shell Over Nigerian Oil Deals

A Dutch court has roundly rejected Shell’s claim that documents seized during a raid on the company’s offices cannot be used as evidence by prosecutors due to legal professional privilege.

Shell had argued that emails and other documents generated by the company’s 15 internal lawyers constituted legal advice and must therefore be excluded in any trial of the company over alleged corruption in its dealings in Nigeria in relation to the OPL 245 oil deal.

The court in Rotterdam rejected this argument, arguing that, in fraud and corruption cases, legal professional privilege applies only to advice from external lawyers.

According to the court, Shell’s internal lawyers cannot be considered independent and their advice is not therefore subject to the usual rules of confidentiality.

The ruling is a major victory for the Dutch prosecutors who are investigating corruption allegations surrounding Shell’s acquisition (with the Italian oil giant Eni) of the controversial OPL 245 oil field.

No professional secrecy for Shell lawyers Legal case

The court finds that Shell’s legal department cannot claim professional secrecy. They are no ordinary lawyers.

Oil company Shell cannot hide behind the professional secrecy of employees of its legal department in corruption and fraud investigations. The Rotterdam court reached that conclusion in a judgment published Friday afternoon.

The court sweeps the floor with Shell’s argument that the fifteen lawyers who are employed by the oil company in the Netherlands can invoke their professional secrecy. The reason for the judgment, which can have far-reaching consequences for major criminal cases, is a judicial investigation into bribery by Shell in Nigeria.

In this investigation, financial investigation service FIOD-ECD invaded in February 2016 at the Shell head office in The Hague. A large number of documents were seized. A part was sent to Milan, where Shell, together with the Italian oil company Eni, is being tried.

Since the raid, Shell and the Public Prosecution Service (OM) have been battling about whether the remaining seized documents may be used for Dutch criminal proceedings. The OM would like that, but the oil company relies on the special position of the fifteen so-called in-house lawyers who are employed in the Netherlands.

These “internal lawyers” are part of Shell’s legal department and are registered as a lawyer outside the Netherlands. For that reason, they should have the same privileges as normal lawyers, such as professional secrecy. The Public Prosecutor should also not use documents on which the internal lawyers have advised in criminal cases, such as those concerning the controversial Nigerian oil deal.

The court leaves very little of this argument. According to the examining magistrate, employees of Shell’s legal department are by no means independent and cannot claim lawyers’ achievements such as professional secrecy.

“The independent position of the Legal Department [of Shell] is in jeopardy, just like that of the foreign in-house lawyers working within the legal department,” according to the judgment. That can be seen, among other things, from the dual role of Donny Ching, the boss of Shell’s legal department – according to the judge. Ching is not only the senior lawyer of the oil company but also a member of the board and therefore “jointly responsible for the general state of affairs within Shell”.

Shell reacts fiercely and appeals. “We believe internal lawyers have the same position and function as external lawyers,” says a spokesperson. According to him, Shell employees should be able to communicate with internal lawyers “in the full legitimate confidence that confidentiality will be respected,” he says. “This guarantee is a guiding principle in many countries.”

The OM is ‘satisfied’ with the opinion of the examining magistrate, although it will take months before it is clear whether the seized documents may be used. That is because, according to Shell, not only internal but also external lawyers have examined the documents.

It is therefore necessary to assess document by document whether that can be added to the criminal file. The expectation is that proceedings will be conducted up to the high council. “The procedures are as they are, so we have to be patient,” the OM spokesperson said.

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