Chinese NGO sues Germany’s Volkswagen over fraud

A Chinese court has accepted to hear a case brought by a local nongovernmental organization active in environmental issues against German carmaker, Volkswagen (VW), over the company’s emissions-cheating scandal.

The China Biodiversity Conservation and Green Development Foundation announced on Tuesday that it will take VW to court over 1,950 vehicles the company has exported to China equipped with the emission cheating software, AFP reported.

The NGO added that the German company has broken Chinese laws and worsened the air pollution problem in the country.

"This is the first case of public-interest litigation against vehicle pollution, and for us it is only the beginning," said Ma Yong, deputy secretary general of the Beijing-based group, who added, "We feel this lawsuit is bound to have a definite impact on other car companies guilty of environmental violations."

Following the group’s announcement, the No. 2 Intermediate People's Court of Tianjin formally accepted the case last week, informing the group through official documents posted to its social media account.

China is the world's biggest automobile market but most vehicles operating in the country use gasoline as fuel.

The legal action has been taken under revised version of China's environmental protection law that came into force during the current year, granting certain NGOs the right to sue polluters.

"Before this law came into force, we could only participate in environmental protection through supervision and by giving recommendations – we couldn't take legal action," Ma explained.

The NGO is going to accuse Volkswagen of violating Chinese laws on product quality, environmental protection and tort liability, the group’s lawyer told the China Daily newspaper.

Volkswagen China did not immediately respond to requests for comment.

The company has been engulfed in scandal since September.

The group, previously regarded as a paragon of German industry, revealed in late September that 11 million of its diesel cars worldwide were equipped with devices that can cheat pollution tests. The revelation rapidly snowballed into a scandal, which wiped a third off the company's market capitalization in just two days.

The trigger to the company's market woes came when it was revealed by the US Environmental Protection Agency that VW rigged nearly half a million cars to pass US smog tests.

The company told US regulators that it intentionally installed software programmed to switch engines to a cleaner mode during official emissions testing. The software then switches off again, enabling cars to drive more powerfully on the road while emitting as much as 40 times the legal pollution limit.

US officials say similar software is on the company's larger 3.0 liter diesel engines, used in Volkswagens, Audis and Porsche SUVs.

The world's number-two automaker faces regulatory and criminal investigations in several countries, including Germany and the United States, and potentially billions of dollars in fines.

"Volkswagen is working tirelessly on an approved remedy for the affected TDI vehicles," Mark McNabb, chief operating officer, Volkswagen of America, said in a statement, adding, "During this time we would like to thank our dealers and customers for their continued patience and loyalty."

The scandal has continued to widen, with the German automaker subsequently revealing that it had understated carbon dioxide emissions, including those for gasoline engines, for up to 800,000 vehicles.

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