Case - France - Union Hidalgo & Others v Electricité de France SA

Union Hidalgo & Others v Electricité de France SA

Summary of facts

EDF is the largest French energy company and it has been planning to build a wind farm in Oaxaca, Mexico since 2015 with power stations planned on the territory of the Indigenous Zapotec community Union Hidalgo. Eólica de Oaxaca (EDF’s Mexican subsidiary) concluded private land leasing contracts with self-declared landholders while, under Mexican law, the claimants argue the land is subject to collective property, requiring previous authorization for leasing from the communal Assembly. By 2017, Eólica de Oaxaca signed energy supply contracts with the Mexican authorities and requested permits to generate electricity without the prior consultation of the Indigneous community. In February 2018, community representatives filed a complaint against EDF in the French National Contact Point (NCP) under the OECD Guidelines for Multinational Enterprises alleging EDF and its subsidiary violated their right to Free, Prior and Informed Consent, amongst other human rights. In October 2018, a Mexican Court ordered the authorities to comply with their obligations under international law and guarantee the Free, Prior, and Informed Consent of the community, yet the decision has not been properly implemented. In July 2019, the complainants withdrew from the NCP process with the NCP and in October 2019 sent a letter of formal notice to EDF, demanding it to comply with the French Duty of Vigilance Law and improve its preventative measures; however, EDF’s response was that their vigilance plan is complies with their vigilance obligation. In October 2020, the claimants filed a lawsuit against EDF S.A. based on the Duty of Vigilance Law, arguing EDF did not comply with its duty of vigilance and seeking an order for EDF to comply, provide injunctive relief and pay compensation for any damages resulting from their breach of obligation.

Timeline

2021 Paris Civil Court

Jurisdiction

Yes

Applicable Law

French Duty of Vigilance

Legal issues

Concerns the parent company’s failure to respect its duty of vigilance to prevent serious violations resulting from its subsidiaries’ activities in Mexico.
It is a civil proceeding seeking an injunction for EDF to comply with its duty of vigilance and claiming EDF’s liability under tort law for damages caused to the claimants.
Plaintiffs seek injunctive relief through an order for the company to halt its project until a final ruling declares EDF is compliant with its obligation of vigilance and all risks are effectively prevented and mitigated, including Indigenous people’s rights to free, prior, and informed consultation.
Plaintiffs also allege EDF representatives have offered unduly benefits and economic incentives to selected community members in exchange of their support for the project, leading to divisions and violence in the community and threatening Indigenous human rights defenders or those who oppose the project.

Ruling / Outcome

November 30 2021: pre-trial judge issued a decision declaring itself competent to rule on the matter; however, it did not rule on the injunctive relief request based on formalistic grounds.
While the court dismissed, the plaintiffs' requests, it confirmed the competence of the judicial court in matters relating to the duty of vigilance law.
This pre-trial decision does not preclude the proceedings on the merits.
The plaintiffs will appeal this decision.

Court case