Shell shake-up leaves Dutch royally hacked off -Breaking
AMSTERDAM (Reuters). Royal Dutch Shell (LON.) has moved its corporate headquarters, tax base, and corporate headquarters from Amsterdam to London. This decision may be a win for shareholders, but it will also hurt Dutch pride.
When the North Sea energy giant passes, “Royal Dutch,” will be dropped from its name. It ends the link with the Netherlands’ monarchy, which began in 1890, when the Royal Dutch Petroleum Company was established.
Even after the tie-up in 1907 with Britain’s Shell Transport and Trading Company, many Dutch still refer to the merger as “Koninklijke Olie” (or “Royal Oil”)
Shell Plc will be its formal name if any changes are made to the dual share structure or other plans are approved.
According to the Dutch government, it is “unpleasantly shocked” at the decision. This was after the country had lost another Anglo-Dutch multinational company to London following a similar move last year by Unilever (NYSE:).
Britain called Shell’s decision a “vote for confidence” after it watched share trading in the millions move to Amsterdam.
Frank van der Vorm from Royal Branding, which is a consultancy that assists organisations in the Netherlands to attain the “Royal”, put on a brave front for Shell’s decision.
He said, “Their reputation was already under pressure because of the global focus fossil fuels.” It’s starting to lose its shine.
The “Royal” title was awarded to only 150 Dutch companies, out of 600,000. This is considered a mark of excellence and longevity in their industry. He said that it would primarily be a loss to Shell.
Some were less optimistic.
The Confederation of Netherlands Industry and Employers said that “with a Shell departure”, the Dutch business environment is “deteriorating” and called the Shell exit an “enormous bleeding for the Netherlands.
The decision by Shell to relocate its Dutch tax residence may not have a significant impact on the state’s revenues. Shell reported that it paid $212,000,000 to the Dutch authorities for 2020, compared with its $3.4 billion global corporate tax bill.
Shell tried to soften Monday’s blow by saying that only a small number of managerial posts would go to London.
However, it could raise additional concerns regarding Dutch businesses. Shell and Unilever lobby the Dutch government for the removal of a dividend-tax that Britain doesn’t impose.
Mark Rutte (Prime Minister), who started his career with Unilever, attempted unsuccessfully to repeal the tax. As a result, he warned multinationals that they could be forced to leave.
Climate activists in the Netherlands had put Shell under severe pressure. Shell appealed a May Dutch court ruling ordering that it move faster to cut carbon emissions.
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