Reuters reports US Attorney for the southern district of New York, David Kelley, as saying Shell’s cooperation with the US government investigation, as well as its settlement with the US Securities and Exchange Commission over its filings, were the main reasons authorities had decided not to prosecute.
Shell had cooperated fully, had implemented substantial remedial efforts to enhance it reserves reporting and compliance, and had paid a substantial civil penalty, Kelley said.
Last year, Shell agreed to pay US$120 million to settle fraud charges with the SEC.
Shell's reserves downgrade scandal, which first surfaced in January 2004, stunned financial markets and hurt its share price. Three leading executives, including former chairman Sir Philip Watts, subsequently lost their jobs.
In June 2004, an internal Royal Dutch Shell audit committee reported that 4.85 billion barrels would be downgraded from its reserves estimates, an increase on the previous 4.14 billion barrels, which itself was an increase on the original 3.9 billion barrel downgrade of proven hydrocarbon reserves as at the end of 2002.
Meanwhile, Royal Dutch Shell shareholders have voted to merge the group's holding companies in the Netherlands and Britain.
This ends a separation that investors said damaged what was the world's largest publicly traded oil company. The merger will combine two companies that created an alliance in 1907 in which they operated as one with separate stockmarket listings and boards of directors.
The votes at Royal Dutch Petroleum Company near The Hague and Shell Transport & Trading Company in London this week will disband the holding companies.
A single share could let the company pay for acquisitions in stock for the first time. It will help with takeovers, allowing the company to build its reserves.
In 1998, Shell was the largest publicly traded petroleum company. But since then, Exxon Mobil and BP Plc have overtaken Shell in terms of revenue, production and reserves by using shares for takeovers.
The new company will be called Royal Dutch Shell Plc and start trading on July 20. It will have its headquarters in The Hague and be incorporated in the UK.
