Royal Dutch Shell will scrap its dual share structure and move its head office from the Netherlands to Britain, after coming under pressure over taxes and climate action.

The company, which has long faced questions about its dual structure aims to drop “Royal Dutch” from its name – part of its identity since 1907 – to become Shell Plc.

The Anglo-Dutch firm has been in a long-running tussle with Dutch authorities over the country’s 15 per cent dividend withholding tax, which Shell sought to avoid paying with its two share classes.

Its new structure would resolve that issue.

Royal Dutch Shell to move its HQ from the Netherlands to the UK. Under changes proposed to shareholders, its corporate structure would be entirely based in UK, with all meetings of executives, board members here too. Name shortened from Royal Dutch Shell to Shell.

— Andrew Neil (@afneil) November 15, 2021

In a further knock to its relations with the Netherlands, the biggest Dutch state pension fund ABP said last month it would drop Shell and all fossil fuels from its portfolio.

The Dutch government said on Monday it was “unpleasantly surprised” by Shell’s plans to move to London from The Hague.

Shell’s shares, which will still be traded in Amsterdam and New York under the plan, climbed more than 2 per cent in London on Monday morning after the news.

“The current complex share structure is subject to constraints and may not be sustainable in the long term,” Shell said, as it announced its plan to change its share structure.

The move requires at least 75 per cent of votes by shareholders at a general meeting to be held on December 10, Shell said.

“We see merits in the proposed restructuring of Shell’s shares structure and tax residence. Among other benefits, the proposed changes will increase Shell’s ability to buy back shares,” Jefferies said in a research note.

Monday’s move follows a major overhaul Shell completed this summer as part of its strategy to shift away from oil and gas to renewables and low-carbon energy. The overhaul included thousands of job cuts around the world.

In May, a Dutch court ordered Shell to deepen its planned greenhouse gas emission cuts in order to align with the Paris climate deal which aims to limit global warming to 1.5 degrees Celsius. Shell has said it would appeal.

-Reuters