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When may a parent company be liable for harm caused by the operations of its subsidiary: new developments in Vedanta Resources plc v Lungowe - Harry Sheehan, Devereux Chambers

07/10/19. The Supreme Court’s decision in Vedanta Resources plc v Lungowe [2019] UKSC 20 marks a substantial new development in the state of parent company liability and provides clear guidance as to when a parent company may be liable to those harmed by the operations of its subsidiary.

Within the last three years the Court of Appeal has decided three cases under very similar circumstances: Lungowe v Vedanta Resources plc [2018] 1 WLR 3575, Okpabi v Royal Dutch Shell plc [2018] EWCA Civ 191, and AAA v Unilever plc [2018] EWCA Civ 1532. In each of these cases a large number of claimants sought to bring claims against a parent company domiciled in the UK after being harmed by operations carried out by their subsidiaries in Africa. In each case the defendants attempted to prevent the claimants from being granted permission to effect service out of the jurisdiction and argued that there was no real issue to be tried against the UK based parent company. In Shell and Unilever the defendants had succeeded, with only the claimants in Vedanta being successful in the Court of Appeal...

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