A message for Shell: Follow the law or get out

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OUR expert columnists here at The Manila Times continually remind of us of critically important issues we might otherwise have overlooked in our efforts to cover day-to-day news, a mission that is challenging even under the easiest circumstances.

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One of those issues was brought to our attention again by Atty. Dodo Dulay, whose “Flipside” column yesterday addressed the incredible situation in which major oil company Pilipinas Shell – the local component of global oil giant Royal Dutch Shell BV – has been allowed to evade compliance with the 1998 Oil Deregulation Law for nearly 18 years up to now.

As Atty. Dulay pointed out, that law stipulates that oil refiners must publicly list at least 10 percent of their common stock shares. The only other refinery operator in the Philippines, Petron, did so more than 11 years ago, in 2004.

Shell has offered a variety of creative excuses throughout the years for avoiding compliance with this unambiguous requirement, to the extent that any announcement by the company that they are “working on an IPO listing” or “hoping a listing can be done by such-and-such time” is treated as a joke by the local media and industry observers. As it has apparently become long-standing policy in the Department of Energy not to press Shell too hard to make good on its occasional casual acknowledgements of the law, it seems the government believes the whole issue is a joke as well.

It is not a laughing matter, however. The “public float” provision in the Oil Deregulation Law is a vitally-important protector of public interest. With the removal of a great deal of the regulatory constraints on the oil industry – a generally prudent move that encourages industry growth and helps to ensure reliable supplies of fuel and other petroleum products – mandating a public stake in the industry, even a small stake, serves as a kind of check against the worst kinds of monopolistic abuse that could otherwise be carried out by fully-private companies.

If they have the wherewithal to do so, the Department of Energy or the Office of the President should order Shell to comply with the law forthwith, allowing only the necessary time (perhaps 90 days) for the preparation of a share listing. If the Executive branch is unable to gather up the courage to do its job and enforce the law – a development which would be disappointing but not particularly surprising – then the Supreme Court should intervene, as Atty. Dulay suggested in his column.

Pilipinas Shell still does, of course, have the choice not to comply, and while it would not be an ideal or preferred outcome, they can simply take their refinery elsewhere; they should not be laboring under the illusion that the country could not adjust to its absence. The bottom line, however, is that the status quo cannot be permitted to continue a moment longer than is necessary to correct it: It is a disservice to Filipino consumers, and makes a mockery of Philippine laws and all other efforts to fairly monitor and regulate vital industries.

We wish to make a point of recalling that Pilipinas Shell has been carrying out its “corporate social responsibility” with activities beneficial to deserving individuals and communities. Four years ago, its corporate peers in the Federation of Philippine Industries gave it an award for being the most outstanding in the CSR field.

That presents a paradox.

How can Shell have a heart of gold in doing philanthropy and be worse than a scrooge and in fact be a lawbreaker?

We hate to say this but it deserves to be told: Do business respectful of the law, Pilipinas Shell, or shut down your refinery.

Don’t be outstanding in the field of corporate legal irresponsibility.

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6 Comments

  1. Another issue neglected by the government. It should be pursued further (may be Atty Dulay) by bringing it directly to the attention of the Department of Energy or filing a suit aginst Shell for breaking the law. Otherwise, nothing will happen. Government officials do not necessarily read the Manila Times or it could be a low priority item for them.

  2. delfin todcor on

    We fervently pray that they officials of DOE and Malacang will be awaken to do something for our peaple and Nation. Luke 12:16-21New American Standard Bible (NASB)
    16 And He told them a parable, saying, “The land of a rich man was very productive. 17 And he began reasoning to himself, saying, ‘What shall I do, since I have no place to store my crops?’ 18 Then he said, ‘This is what I will do: I will tear down my barns and build larger ones, and there I will store all my grain and my goods. 19 And I will say to my soul, “Soul, you have many goods laid up for many years to come; take your ease, eat, drink and be merry.”’ 20 But God said to him, ‘You fool! This very night [a]your soul is required of you; and now who will own what you have prepared?’ 21 So is the man who stores up treasure for himself, and is not rich toward God.”

  3. delfin todcor on

    Proverbs 15:27New American Standard Bible (NASB)

    27 He who profits illicitly troubles his own house,
    But he who hates bribes will live.

  4. delfin todcor on

    I believed that Shell officials act with impunity knowing that our present administration officials at DOE and PNoy are inept. This can happen if our officials are doing their Job well with honesty. Maybe they closed their eyes because they are receiving bribe money. When do we have officials who is compassionate and have concern for the National interest? We hope we will have responsive honest officials on may 2016!!!

  5. Maybe there are few “BIG CROCS” who are enjoying the non compliance of Pilipinas
    Shell.

    • Felix Sevidad on

      Bullseye you hit the target, that big crocs should be remove first. But how?they’re enjoying the immunity they’re untouchable while still in power, when their terms ended, another crocs will takeover more hungry and the story continues over and over.