NETHERLANDS - European pension funds look set to receive a slightly higher settlement in the Shell class action than previously stated, if the deal is approved by the Amsterdam Court of Appeals in November.

The Stichting Shell Reserves Compensation Foundation and Royal Dutch Shell plc agreed a $352.6m (€222.69m) deal in April last year to settle compensation claims made by several large European pension funds, for what the pension funds described as the substantial misreporting of oil reserves and its subsequent financial impact. (See earlier IPE story: European Institutions win €263m from Shell)

But a statement from Shell says ‘non-US' investors are now likely to receive a share of an additional $35m if the Dutch Court of Appeal makes the settlement binding, because the US case - which has yet to be finalised and approved by the US court -  contains a base settlement of $82.85m "to resolve the securities class action pending in the US from which non-US shareholders were excluded in January".

The European case being heard in Amsterdam will be a landmark development because class actions have to date been managed in the US, where it was considered the only jurisdiction to file such legal activity.

Dutch pension funds ABP and PGGM - now know as PFZW - brought the action in the US in January 2006 on behalf of over 40 pension funds Europe-wide, to bring what was described by officials as "a uniquely European resolution to settling a European securities claim", and then withdrew from the US action to bring an EU-located legal action. (See earlier IPE story: Dutch schemes sue Shell over reserves)

However, parties had to wait to file an amended petition for the European deal until the US court ruled it did not have the jurisdiction to consider claims for ‘non-US' shareholders even where based on the same reserve issue.

Theo Raaijmakers, chairman of the Foundation's board, said: "In the past months the support for the European settlement has continued to increase. After the non-US investors of Shell were excluded from the US case, the parties to the European settlement finalised an amendment petition so that additional details respecting the settlement could be provided to the Dutch court. Now that the Court has set a date for the hearing, the parties will provide notice of the settlement and of the hearing to non-US investors."

As the settlement case is not being heard until November, the Shell parties have also agreed to pay interest on the additional $35m from April 1, 2008.