LONDON—Royal Dutch ShellRDSA+0.48% PLC Thursday appeared in court in the Netherlands for the first time over the actions of one of its foreign subsidiaries, facing compensation claims for environmental damage from oil spills in Nigeria.

The case could set a legal precedent over how Dutch companies are held responsible for the actions of their foreign subsidiaries.

The suit has been brought by environmental group Friends of the Earth Netherlands and four Nigerian farmers, who are seeking compensation over claims that oil spills from Shell pipelines in Nigeria have damaged their livelihood. They also say they want the Anglo-Dutch oil company, headquartered in The Hague, to complete a cleanup of the spills.

Shell argues that the three oil spills in question were caused by sabotage of pipelines and as such it isn't liable to pay compensation. A spokesman for the company said its Nigerian subsidiary has cleaned up the pollution at the three locations and that this has been certified by the Nigerian authorities.

The case is important because it is the first time a Dutch multinational is being sued in the Netherlands over the actions of an overseas subsidiary. It could set an important legal precedent, said Channa Samkalden, a lawyer at law firm Bohler, which is representing the Nigerian farmers.

"If the verdict of the Dutch court turns out to be beneficial for my clients, a major precedent will be set," in relation to how companies are held legally responsible in the Netherlands for the actions of international subsidiaries, said Ms. Samkalden.

The verdict will be delivered Jan. 13, 2013.

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