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[Page 784]

BEFORE THE INTERNATIONAL CENTRE FOR SETTLEMENT OF

INVESTMENT DISPUTES

ICSID Case No. ARB/21/29

- - - - - - - - - - - - - - - - - - - - - x

In the Matter of Arbitration Between:

Kaloti Metals & Logistics, LLC,

Claimant,

and

THE REPUBLIC OF PERÚ,

Respondent.

- - - - - - - - - - - - - - - - - - - - - x Volume 4

HEARING ON JURISDICTION AND THE MERITS

Thursday, July 27, 2023

The World Bank Group

1125 Connecticut Avenue, N.W.

Conference Room C1-450

Washington, D.C.

The Hearing in the above-entitled matter

came on at 9:02 a.m. before:

PROF. DONALD MCRAE

President of the Tribunal

PROF. DR. JOSÉ CARLOS FERNÁNDEZ ROZAS

Co-Arbitrator

PROF. DR. ROLF KNIEPER

Co-Arbitrator

[Page 785]

ALSO PRESENT:

MS. CATHERINE KETTLEWELL

Secretary to the Tribunal

Realtime Stenographer:

MR. DAVID A. KASDAN

Registered Diplomate Reporter (RDR)

Certified Realtime Reporter (CRR)

B&B Reporting/Worldwide Reporting, LLP

529 14th Street, S.E.

Washington, D.C. 20003

United States of America

SRA. MONIQUE FERNÁNDEZ

SR. RODOLFO RINALDI

D.R. Esteno

Colombres 566

Buenos Aires 1218ABE

Argentina

Interpreters:

MR. DANIEL GIGLIO

MS. SILVIA COLLA

MS. MONIQUE FERNÁNDEZ

[Page 786]

APPEARANCES:

On behalf of the Claimant:

MR. HERNANDO DÍAZ CANDIA

MR. RAMÓN AZPÚRUA

MS. GABRIELLA HORMAZABAL

MR. SEBASTIÁN ORDOÑEZ

MR. MIKEL del VALLE-CORONA

WDA Legal

848 Brickell Avenue

Suite 1000

Miami, Florida 33131

United States of America

Party Representatives:

MR. [Redacted]

Founder

MS. [Redacted]

Finance Manager

[Page 787]

APPEARANCES: (Continued)

On behalf of Respondent:

MS. VANESSA RIVAS PLATA SALDARRIAGA

President, Special Commission that

Represents Peru in International

Investment Disputes

MR. JHANS PANIHUARA ARAGÓN

Counsel, Technical Secretariat to the

Special Commission that Represents Peru in

International Investment Disputes

MR. GINO CAMPAÑA ALBÁN (remote)

SUNAT's Representative before the Special

Commission

MR. JUAN FALCONÍ GÁLVEZ (remote)

Ministry of Justice's Representative before

the Special Commission

MR. PATRICIO GRANÉ LABAT

MS. MÉLIDA HODGSON

MR. ÁLVARO NISTAL

MS. KATELYN HORNE

MR. TIMOTHY SMYTH

MS. CRISTINA ARIZMENDI

MR. PETER SABAN

MS. ANDREA MAURI PARICIO

MS. PALOMA GARCÍA GUERRA

MR. AGUSTIN HUBNER

MR. ANDRÉS ÁLVAREZ CALDERÓN

Arnold & Porter, LLP

601 Massachusetts Avenue, N.W.

Washington, D.C. 20001

United States of America

MR. JORGE LAZO (remote)

MR. ROCHAR ALLEMANT (remote)

MR. JOSE JARAMILLO (remote)

Lazo Abogados

Pardo y Aliaga 699, San Isidro Lima

Gobierno Regional de Lima LIMA, 27

Peru

[Page 788]

APPEARANCES: (Continued)

On behalf of the United States of America:

MR. DAVID BIGGE

MS. MELINDA E. KURITZKY

Office of the Legal Adviser

United States Department of State

Washington, D.C. 20520

United States of America

[Page 789]

C O N T E N T S

PAGE

PRELIMINARY MATTERS...................................790

WITNESSES:

DINO CARLOS CARO CORÍA

Direct presentation..................................793

Cross-examination by Mr. Grané Labat.................815

Redirect examination by Mr. Del Valle-Corona.....925

Recross-examination by Mr. Grané Labat.............934

Questions from the Tribunal..........................941

JOAQUÍN MANUEL MISSIEGO DEL SOLER

Direct examination by Mr. Grané Labat............963

Direct presentation..................................964

Cross-examination by Mr. Díaz-Candia.............980

Questions from the Tribunal.........................1053

[Page 790]

P R O C E E D I N G S

PRESIDENT MCRAE: Good morning, everyone. I

think we're ready to begin.

Before we start with the Experts, are there

any procedural matters from the Claimant's side?

MR. DÍAZ-CANDIA: Good morning.

No, Mr. President.

PRESIDENT MCRAE: From the Respondent?

MR. GRANÉ LABAT: Good morning. No, thank

you.

PRESIDENT MCRAE: Then let us start with

Dr. Caro. Can you come to the witness stand, please.

DINO CARLOS CARO CORÍA, CLAIMANT'S WITNESS, CALLED

PRESIDENT MCRAE: Good morning, Dr. Caro. I

understand you're going to be giving your testimony in

Spanish?

THE WITNESS: Spanish, please.

PRESIDENT MCRAE: Pardon?

THE WITNESS: Pardon.

PRESIDENT MCRAE: Yes.

I understand you're giving your testimony

today in Spanish.

[Page 791]

THE WITNESS: Yes, sir, in Spanish.

PRESIDENT MCRAE: And it will be interpreted

into English.

You probably know the process. You saw it

yesterday, where it's similar for the experts as it

was for the Witnesses. You will start with making

your own Opening Presentation. Then you will be

cross-examined by counsel for the Respondent, and then

counsel for the Claimant will have an opportunity to

ask questions on redirect.

The Tribunal may ask you questions from time

to time as well. And if you could remember that,

since everything is being interpreted, when you

respond to a question, you should perhaps wait until

the question has been interpreted before responding.

You're listening to the interpretation, I assume, so

you will have to wait in any event. It's the

interpretation back to English that might be a bit

DIRECT PRESENTATION

THE WITNESS: I thank the Members of the

Tribunal and also the colleagues participating in this

Hearing. I am appearing here as an expert for

Claimant, Kaloti Metals, to present the main problems

in the application of Peruvian criminal law and

criminal procedure in this matter.

As we know, I should mention that I was

contacted by WDA to provide a legal opinion to support

some concepts of procedural and criminal Peruvian law.

It is important, then, to bear in mind my experience.

I have a degree in law from the Pontificia Universidad

Católica del Perú. I have a Ph.D. in Law from the

University of Salamanca. I have also--I was granted a

special award for dissertation from the University of

Salamanca. I have 20 years of experience providing

legal advice. I have also work that has been

recognized and published. I have authored more than

100 specialized articles, and also as to the

general--I have also published on the general aspects

[Page 794]

of criminal law.

I also have been practicing for more than

29 years, and I have defended public and private

agencies to provide counsel on these legal issues.

I am also a partner in my legal firm, Caro &

Associates, and I have been recognized by Chambers &

Partners, Legal 500, and Legal League, among others.

I appear here as an independent expert to

provide an objective opinion and a truthful opinion on

the subject that I was presented with for

consideration.

The key element here has to do, in my

opinion, with the fact that KML has conducted five

purchases of metal gold from the companies that we

heard these days, that is [Redacted], [Redacted],

and [Redacted]. I am not going to refer to the kilograms

or grams of those purchases. I do not think that is

necessary in this case. But it is here--the Peruvian

State initiated a series of administrative proceedings

at the level of SUNAT so as to immobilize the

Shipments, and coordinated manner, they were also

impacted by means of some petitions by the Office of

[Page 795]

the Attorney General, and these were some

Precautionary Measures that were presented prior to

the proceeding. In arbitration , prior to the

constitution of the Tribunal, some laws allow for some

earlier measures. It is similar to what happens here

in the U.S.

So, this Criminal Proceeding, it started

with a decision by the Judge; but, since a long time

had to be--had to elapse between the investigation by

the Ministry and the Decision by the Judge, law 27379

was passed. I was one of the authors of that law in

the Year 2000, and then there were some reforms that

were introduced.

So, what is it that the Public Ministry had

to do? They had to present a petition before the

Judges to be able to seize the goods. The law is

quite clear: The Terms are 90 plus 90 days, that can

be extended 180 days, not more. Upon expiration of

that term, the State should have returned the goods to

their legitimate owner.

What we saw here is quite the contrary.

Between the termination of these terms, we are here in

[Page 796]

a vacuum because this was issued months later, the

Decision was issued months later, and this is not only

recognized in my own Report, but also in the Report

drafted by Mr. Missiego, months after these Measures

were enforced. But, between 2015 and 2016, Kaloti

Metals presented a series of petitions before the

Tribunals, the Public Ministry, in order to gain

access to the information. And it is key because

Article 4(5) of the law 27379 expressly provides that

the Judge must notify the affected parties. The judge

"must." This is not optional, not something that

happens at random, nor something that can be seen in

the press. If they are going to seize something, they

need to let you know, but if no one knocked on your

door to let you know that they were going to do this,

this is illegal. Well, we are talking about public

law, we are talking about what is usually referred to

as the power of the police.

So, that is to say, if they are having--if

the Measures are having an impact on the assets, on

your assets, you need to be notified, you need to be

informed, so this is something that has an impact on

[Page 797]

your rights, on your own rights. So, the Judge made a

decision without listening to any of the Parties

listening--they didn't listen to any of the Buyers and

the Parties. And then, with whatever they had, they

made a decision to enforce these seizures; but, based

on the evidence that I was able to review for this

Report, I haven't been able to observe the enforcement

or the compliance of the Judge with the duty to notify

Kaloti so that Kaloti may enforce their own rights.

So, as a result of the opinions by the

Peruvian expert, I saw some procedural documents of

unknown origin because the criminal proceedings are

reserved. No one has access to that information

except there is a legal order, and I have not seen any

notification, any notice tor Kaloti Metals that would

have enabled it to exercise its right.

There is not much to be said in connection

with the impairment of these four shipments in the

case of [Redacted], [Redacted], and [Redacted]. I

am saying that there is not much to discuss. I am

going to avoid going into details as regards numbers

of documents, file numbers...

[Page 798]

MR. DEL VALLE-CORONA: I apologize for the

interruption. Can you speak a little bit slower?

THE WITNESS: Yes.

There is not much discussion surrounding

this because these are procedural issues that I

understand are not the subject matter of the dispute.

Based on the information that was presented in the

First and Second Report by Mr. Missiego that was also

provided to me. I have seen that there is not a

discussion on the path followed by these proceedings.

And, in the First Report, he, Mr. Missiego,

noticed that there were two prosecutorial filings, and

I don't know--and there were two others that were

underway. We do not know what the Prosecutor will be

deciding, and they are all of a sudden saying that

there were three cases presented. I have not had

access to that information, except for what he has

considered and explained in his reports.

I am going to move on to the questions and

the answers that I have addressed--that were addressed

in my First and Second Report.

As to the First Report, the question as to

[Page 799]

whether the Seizure Measures and Immobilization

Measures against the gold owned by Kaloti Metals were

issued in accordance with Peruvian law. The answer is

"no." The Immobilization and Seizure Measures did not

comply with Peruvian legislation, and I am saying this

clearly because the Law 27379 demands not only the

appearance of an offense fumus comissi delicti, but

also there has to be some prejudice in the delay.

What is the reasoning behind this? This

could be administrative. We could discuss for several

hours for those who are familiar with mining sector in

Perú and those who know how work is done in this

sector. I have more than 20 years of experience in

the Mining Law sector where we could address each of

the administrative indicia given by SUNAT for the

Petition later on presented by the Prosecutor's

Office.

The Prosecutor's Office, almost like a table of

parties, copies and pastes the indicia listed by

SUNAT, the Prosecutor's Office then turns that into a

precautionary petition, and then the Judge decides

based on that information.

[Page 800]

So, Mr. Missiego has also said that after

that, these Measures have been approved by the Judge

with new information, new data, but he does not refer

to what data it is. This is administrative indicia

for the administrative immobilization. And we can go

over that information, each of those pieces of

indicia, but I wouldn't do that because each of them

is contingent. And to understand them, once again, we

need to understand not only criminal law but also the

gold sector and how this works in the Peruvian market.

So, since there was no indicia of a criminal

offense but rather indicia of administrative

infractions, or maybe even crimes, but linked to the

sellers - public faith, etcetera, there is nothing

that is linked to illegal mining or money-laundering.

And now, as to the danger or the prejudice

that could be entailed in the delay, this is only

founded on the fact that gold cannot disappear, and

this is the gold that is in the hands of SUNAT.

Someone has to have it. If it is not Kaloti, it

cannot be someone else, so that appears to be the

justification.

[Page 801]

There are also mentions and even some

boasting as regards the coordination among

administrative units, SUNAT, the Office of the Public

Prosecutor, and I think that the fight against

money-laundering, the fight against illegal mining

also requires institutional coordination, but there

needs to be transparency. And for transparency, there

has to be communication, communication records.

So, how have the SUNAT officials

communicated with officials from the Public

Prosecutor's Office? They must follow certain paths.

According to the criminal law, the Prosecutor needs to

reach out to private and public authorities, but they

need to have minutes, minutes of communications to see

what was communicated, how and when. So, there needs

to be coordination, and the State has to coordinate,

but there has to be transparency. That transparency

is absent throughout these proceedings, and that's why

I considered that these Measures are detrimental, are

prejudicial to the rights of Kaloti.

And as mentioned before, Article 4(5) of

Law 27379 is final. It's clear. The judge needs to

[Page 802]

notify the affected Parties. And from the

documentation, we can clearly see that Kaloti Metals

was one of the Parties that was affected. From the

documents it is easy to see that one of the affected

parties is Kaloti Metals.

What did the State do? Nothing. Based on

the information we have and also in the responses and

also on the letter of Peruvian law, nothing is said

about the notification. Nothing is said about a

notice being served to be able to practice the law as

it should have been practiced.

Now, these Immobilization Measures need to

be temporary or permanent? This is a very old, dated

discussion. If we are talking about preliminary

measures, Law 27379 is a law that establishes a term,

90 days plus another 90-day term. A maximum of

180 days. This is like a detention. After 180 days,

if there was an extension, the gold had to be

released. A person cannot be in prison longer than

what is decided by the Judge; otherwise, it would be

an illegal detention. The next day, on the 181st day,

if both Terms had been used, the gold should have been

[Page 803]

delivered to its rightful owner, and this is something

that I was unable to see in the relevant cases,

because the law establishes that the Judge may

validate the seizure, but the seizure has to be still

in force because, according to Article 94 of the

Procedural Code, the previous seizures have to still

be in force at the time in which the Judge makes a

decision. 803his is not something that we see here,

and this is something that is detrimental, detrimental

to the right to property and the right that Kaloti

Metals had.

Now, on the other hand, we also heard that

Article 94 allows the Judge deciding on the asset

forfeiture to maintain the Precautionary Measures, but

as long as an Asset Forfeiture Proceeding actually

exists. Article 94 cannot be cited in parts, or be

quoted on a skewed manner; it must be read in full.

Article 94 states that the Criminal Judge, if the

Judge considered that there is a potential asset

forfeiture case, would notify the Office of the

Prosecutor, and in that case, of the Public

Prosecutor; and then, if the Measures were still in

[Page 804]

force, if the Measures were still in force, the Judge

may still maintain them from the Criminal Proceedings

to the Asset Forfeiture Proceedings. That is what the

law says. So, the law does not say that these

Measures will prevail forever.

We cannot normalize an eight-year

proceeding when procedural law is clear. This is a

proceeding that may only last in very complex cases,

and I agree with the Expert from Perú that this is a

complex case, but what does the law say? That in

complex cases a process this can only last up to

12 months. It does not provide for anything else.

And so, in this case, we are dealing with

proceedings that have been going on for years and

there is jurisprudence from the Constitutional Court

where claims have been declared well-founded and the

proceedings have been shelved, as in the case of

Humberto Abanto Verástegui, with two years of

preliminary investigation. Or, in the case of

Chacon, the case came to an end because it was pending

for eight years, and never came to a conclusion.

On the other hand, these Immobilizations led

[Page 805]

to violations-did these Immobilizations violate

Kaloti's right? Yes. Because of the reasons that I

have mentioned, and only for purposes of listing:

violation of the principle of legality, because

procedural law requires credibility of the right

invoked, that is to say, there has to be an appearance

of offense, and secondly, there must be prejudice in

the delay. There is a series of procedural reasonings

behind the principle of proportionality. Peruvians

have inherited from German law, the proportionality

test of Jurgen Habermas; proportionality, in the

strict sense of the word, the principle of necessity,

and also the principle of having the least potential

impact, given the Precautionary Measures.

So, from a Constitutional point of view

there was no reasoning whatsoever. There is no

reasoning whatsoever as regards the observance of the

proportionality principle that has been widely

accepted under the Constitutional Court in Perú, and

also the Supreme Court of Perú. Effective procedural

protections have been violated because, as far as I

have been able to review as expert, Peru has not been

[Page 806]

able to show any notification to Kaloti Metals

informing of the affectation of its right so as to

enable it to exercise the corresponding recourses. And

also, under Peruvian law, the State, the Peruvian

State, had the obligation to act in a proportional

manner because of the reasons that I just mentioned.

The principle of proportionality also leads us to

apply the test that I just mentioned a minute ago.

On the other hand, is it reasonable and

proportional to maintain the Seizure Measures of 2013?

No, because this is a violation of the reasonable

period. It is said that those Measures in the

proceeding may take--may be in force forever, and this

is like saying that the Criminal Proceeding will be

affecting your rights as long as it lasts. Almost as

saying that we can maintain a Precautionary Measure in

force for as long as it wants a process to last.

I am from Callao, Perú. There are people

who die on a daily basis, but this is not right. It

doesn't mean that--to have something that leads to

killings on a daily basis, in the city--or that it

happens in my country, in my city in Latin America, is

[Page 807]

not something that can be taken as normal, as the

norm.

So, this is again--we cannot look into the

fallacy and say, "Okay, it happens in actual life, so

it becomes the norm." So, this is a fallacy. We're

talking about complying with legality, so this is a

discussion on the law.

The next question was whether KML had the

burden of proving the legality? Evidently not.

Clearly, the presumption of innocence implies that the

State has the burden of proving the case, and there

are some procedural standards, and the highest one is

beyond any reasonable doubt, that must be met in order

to declare the sellers guilty; not Kaloti Metals

because it has not been accused of any . And so far,

Kaloti has not been informed of any wrongdoing, even

when their rights were breached.

Legally, under Peruvian law, should Perú

return the immobilized gold? Yes, of course. and this

has lasted for more than eight years, and a

Precautionary Measure cannot extend forever and also

have something become normal when it is not. We

[Page 808]

cannot resort to that ontological fallacy.

Now, what are the legal implications of the

Decisions by the Supreme Court of Justice of Lima?

Now, as part of the proceeding that discussed the

resolution of the--the resolution of the Contract or

of one of the Contracts between [Redacted] and Kaloti. this

is a very interesting Decision, very interesting

Judgment, and I understand that, based on the Report

by Mr. Missiego, this is a case that has already been

settled because Kaloti Metal had the ownership of the

gold. Why go to the judicial authorities to request

the nullity of the Contract, or why request the

termination of a contract if you're not the owner? If

to [Redacted], Kaloti was not the owner, why would

they go to the Judicial Power? Why go to a first

instance, second instance, annulment, return to

decision and first instance and decision in second

instance? This same reasoning applies to all the

shipments that are being discussed here.

Now I will move on to the questions on the

Second Report to come to an end.

So, how the transfer of the property is

[Page 809]

carried out? This is basic law knowledge. There is

no need to be an expert on civil law. This is what we

see on a daily basis in particular when we're talking

about corporate law. The ownership of real estate,

and specially the sales agreement, is based on

consent. Agreement on the object, agreement on the

price; whether the payment was made or not, and also

there are some rules to resolve--to settle the

Contract, and this is already agreed. There is no need

for a written contract.

I can go to H&M and buy $10,000 in clothing,

and I am not going to have a written contract but

obviously there is a sales agreement. It doesn't mean

that I'm going to have all of the rules applied for

the purchasing and the sale of goods, but--mass goods,

but I will be the owner of those clothing--of those

pieces of clothing, and the same applies here in Perú.

In Perú, in the gold business, there are

sales agreements with purchase orders, sometimes there

are formal contracts, that truly depends on the

practice of each company, but the law is free in the

sense that the mere consensus on the agreement, the

[Page 810]

agreement on the price and the object already

generates, let's say, the transfer of the property.

So, there has to be consent and agreement on the

price and also on the subject matter, and that also

leads to the transfer of the property.

And, in the case of real estate, that also

implies the delivery or tradition, that could be an

actual delivery through third parties or even the

tradition fictiodocumentaria.

On the other hand, via documents and also

through third parties.

Was Kaloti Metals the legitimate owner of the Five

Shipments? I think that that is the case. I am

totally convinced about that, but also because

lawsuits as the one as--of [Redacted] v. Kaloti means

that you need to resort to the judicial authorities to

terminate a Contract. If you were not the owner, it

means you didn't have the need to resort to the

judicial authorities.

What is the element that we need to have in

force so that we have good faith? Good faith is

assumed under the law. There is a presumption, a

[Page 811]

legal presumption, of good faith, so the Party that

has to detect whether there is bad faith is the one

that is alleging bad faith, but no one has alleged bad

faith on behalf of Kaloti. There is no judicial

decision, there is no decision by the Office of the

Public Prosecutor where they say, "Okay, you

are"--where they say, "You are a purchaser in bad

faith because of this or that." There is none as far

as I have been able to check in the documentation--

So, to refer to "bad faith," bad faith would imply a

series of pieces of information and also knowledge,

and there has to be an accusation for bad faith to be

supported by a judicial decision. As long as bad

faith hasn't been shown, then you presume good faith.

If you say there is bad faith, then you need to show

it within or before a court.

There is also--is there a standard on due

diligence? Here I agree with our colleague from Perú,

the counsel from Perú, in the sense that Kaloti Metals

was not a regulated entity in the sense of the

application of the law that requires mandatory

compliance in the prevention of money laundering. If

[Page 812]

they had been, then the financial investigation unit

would have said--knocked on their door and said "where

are your prevention systems?" That would have

happened and did not happen and that had not happened

during the years that the business was operating in

Peru until November 2018. So, that regulation is not

applicable to them. That is something we agree on.

What we agree on are the rules on due

diligence that are supposed to be self-regulating. The

self-regulation does not imply police due diligence. I

don't need to know the criminal history of someone

because there is also a protection on those of the law

of protection on personal data.

Having the criminal records of someone else

is a crime. To say: "Hey, don't you know the criminal

history of someone?". Having them is a crime in Perú,

and the data protection authority and the

Constitutional Court has established very strong and

harsh protections on getting to know someone's

records, someone's legal record. Companies that sell

a database such as Refinitiv, World Check and others,

that in their database include criminal record

[Page 813]

information, they would be selling illegal

information. They will be committing a crime if they

spread that information and, even worse, you can't

make compliance by breaking the law.

Also, the Legal Expert from Perú, through

his Reports, has mentioned that there were several

ways for KML to enforce its rights. "Hey, I'm not

obligated to exercise self-defense. If someone comes

to kill me, they can't say it was my fault because I

did not defend myself." These are rights, not

obligations. There was discussion about a

re-examination that could be requested. I'm one of

authors of the new Criminal Procedure Code of 2004,

but it does not apply here. The old Code applies. The

new Code does mention re-examination. The

re/examination, the Plenary Agreement of 2010 that

supports it is made for that new Code, not for the old

one.

Now, if I go before a judge with the old

Code, as in this case, a code that is losing its

force, and I said: "Let's go to the re-examination",

he would say: "What re-examination, if there is no

[Page 814]

procedural route?" That is for the new Code, the new

regulation. The new code brings many developments,

among them, the re-examination. That re-examination

is impossible here.

Now, also, they mentioned a petition that

you need to put before the Judge. You need to go to

the Judge and request. Yes, that's correct, you need

to go to the Judge and request. Kaloti tried to do

that in some cases. If they did it correctly or not,

we can discuss that, but that does not mean that the

article 4°, 5th Paragraph of Law 27379 compels the

Judge, that is, the proactivity needs to come from the

Judge by order of the law, 5th Paragraph of article 4°

of Law 27379. The Judge needs to notify the affected

Parties. Now, as far as I have been able to see, that

has not happened here. That has not happened here.

That Kaloti could have litigated better or

worse, we can discuss that. Then there is the amparo:

well, nobody is obligated to go for an amparo. The

amparo is a sort of extraprocedural challenge. It is a

challenge outside of the process. For the amparo, and

we all know that this is how it works in Perú and in

[Page 815]

all systems with similar proceedings, the amparo

requires the exhaustion of the previous method, and

the previous method was the criminal procedure and

this had not taken place because the notification

hadn't taken place.

I'm almost done.

Bearing in mind the regulatory framework,

the judicial proceedings, have the judicial

proceedings been compliant with Peruvian law? For the

previously mentioned reasons, no. Taking into account

this legal framework, is it fair, proportional and

reasonable that this is maintained? This is now

nine years later, not eight as the Question says. The

answer is no, because this, of course, clearly goes

against any reasonable term.

The indicia that were used in the decisions

meant that the burden of proving the legality of the

gold was reverted? The answer is also no. First,

those indicia are contingent, as we can discuss, even

with the screen in front of us, one by one, we will

surely take several hours. These are indicia that

refer to the Sellers, not to Kaloti Metals. And these

[Page 816]

indicia have never been used to make formal charges

against Kaloti Metals of which they can defend

themselves against. There is no formal criminal

charges against Kaloti but also no charges of bad

faith, as our colleague from Perú said in his first

and Second Report.

The charges of bad faith can't be in the

grammar or made verbally, they have to be presented

before a court, where they say to them "Kaloti, you

are bad faith purchaser. And I, the State, through the

government, the Prosecutors Office, the SUNAT, say to

you that you are a bad-faith Buyer because of these

reasons." I have not seen a document in the record

that I reviewed where this bad faith is being charged

because, as I said, the good faith is presumed . Who

says that there's bad faith needs to prove it before a

court.

With this I conclude.

As of November 30th, 2018, Kaloti was the

legal owner of the Five Shipments of gold. Now, a

potential indictment against the Sellers would not

change this conclusion, especially if we're talking

[Page 817]

about good-faith purchases. The indicia contained in

the Report from the Perú Expert are contingent, and is

at most sufficient to initiate a criminal

investigation against the Sellers, not against Kaloti

Metals, who does not have proceedings. The burden of

proof is still on the government, on the State to

establish this criminal case that currently does not

exist and to establish bad faith, which hasn't been

done either, as far as I have been able to see in the

documents.

So, the Measures referring to the possession

of the gold continues to be strictly temporary under

Peruvian law, temporality that has turned into

something permanent, it seems. Kaloti acted

reasonably. In its exercise of its procedural rights,

they are not forced to exercise those ways that were

identified by the colleague from Perú, under Peruvian

law.

Thank you.

PRESIDENT MCRAE: Thank you very much,

Dr. Caro.

We now turn to Respondents for the

[Page 818]

cross-examination. Is it Ms. Arizmendi?

MR. GRANÉ LABAT: Thank you, Mr. President.

I will start the cross-examination.

PRESIDENT MCRAE: Thank you. Please go

ahead.

MR. GRANÉ LABAT: Thank you.

CROSS-EXAMINATION

BY MR. GRANÉ LABAT:

Q. Good morning, Mr. Caro Coria. During this

cross examination I will ask you a number of questions

on your opinion, your two legal opinions as Legal

Expert, and the documents to which you refer Reports.

A. Can you speak a little bit louder, I can't

hear you. I'm sorry.

Q. If you have any difficulties you can also

use the headset.

If I ask you a question, I ask you to please

limit yourself to answering the question; if you

would like to expand on it, you will have another

opportunity to do so. I will ask you a few questions

where I need a "yes" or "no" answer. I'm simply

asking you to confirm something that you said or that

[Page 819]

is in the document as we will do for subsequent

questions.

And I will tell you the source of the

documents that I will be citing, we'll be showing them

on the screen. You have a computer on your desk, and

you will be able to access all the documents on the

record there.

You understand the rules I have explained to

you.

A. I'm sorry?

Q. Do you understand the rules I have explained

to you?

A. I understand what you have said to me. I

don't know that they're rules necessarily, but I do

understand.

Q. Do you speak English?

A. No, not perfect English.

Q. What do you have on the table? I see that

you have some books and some notes.

A. It's the Criminal Code.

Q. And you also have a binder? I'm not asking

you to show me the contents. I just want to know what

[Page 820]

you have on the table.

A. These are my Reports and the Reports from

Mr. Missiego that were given to me.

MR. GRANÉ LABAT: I will switch to English.

PO4, Section 22, indicates that the Experts

can only have their reports and the annexes and notes

on their reports. We see that Mr. Caro Coria has a

book on the table. We will not raise an objection.

We are simply noting that for the record, and also in

the event that Mr. Missiego wishes to have also a book

on the table, then we would expect the same

flexibility in that respect. Just for the record.

PRESIDENT MCRAE: Thank you, Mr. Grané. The

point is noted.

MR. DÍAZ-CANDIA: We also want to note we'll

take a look at Procedural Order No. 4, but we

understood that the Experts were allowed to have the

other Expert's Report on the table.

PRESIDENT MCRAE: I think the point is not

an issue now and we just simply proceed on this basis.

THE WITNESS: I would like to clarify one

point, if I may.

[Page 821]

It's not a book. It's criminal law,

procedural law, just to make it clear that it's not a

Manual on criminal law.

BY MR. GRANÉ LABAT:

Q. Have you been present at other

cross-examinations at other ICSID arbitrations?

A. Yes.

Q. And you have been there in person?

A. Yes.

Q. And you have posted something regarding that

on your Twitter account.

MR. GRANÉ LABAT: Let's show Exhibit R-364,

Page 2 on the screen.

And, for the record, I will read this in

Spanish. It says: "Dino Carlos Coria, week of

hearings at ICSID in Washington, D.C. for the third

time. All lawyers want to participate in the big

leagues, this is one of them."

BY MR. GRANÉ LABAT

Q. And then, you refer to some litigation

techniques and particular elements. And there, we see

[Page 822]

that your name shows up on the image.

Do you confirm that this is from your

account?

A. Yes. In that occasion you were also present

in that hearing.

Q. Do you remember what case it was?

A. Yes, it was a case last year, but--.

PRESIDENT MCRAE: Would you slow down. You

are speaking across each other, and it makes it

impossible for the interpretation to be carried out,

and it's very difficult for us to follow who's

actually speaking when actually the interpretation is

different from what we're hearing.

Thank you.

THE WITNESS: What was your question,

please?

BY MR. GRANÉ LABAT:

Q. Do you remember which case it was?

A. Yes, I do remember.

Q. Can you share that?

A. I can't because there are confidentiality

rules that apply to the case as they do to you, I

[Page 823]

think, as well.

Q. In what capacity did you participate?

A. As a lawyer, accompanying the team

representing the Claimant.

Q. That case for the record is Enagás S.A.,

Enagás Internacional v. the Republic of Perú.

You participated as counsel for a Party;

correct?

A. No. I was not litigating at the ICSID

level. I was an auxiliary lawyer. I see that case

according to the Peruvian law.

Q. Do you remember the List of Participants for

that case?

A. No, I don't remember.

Q. You don't remember that you were on that

List of Participants as counsel for the Claimant?

A. That was not the question. The question was

whether I remembered the List of Participants, and I

don't. If the question is whether I was a

participating lawyer, the answer is yes, I was, you

and I have seen each other.

Q. Do you remember that, on that List of

[Page 824]

1 Participants, you showed up as a lawyer for the

2 Claimant? "Yes" or "no."

3 A. No, because I was simply a lawyer who was

4 invited to join the group or the team, but I did not

5 participate in the examinations.

6 Q. But you were providing counsel to the

7 Claimant. You don't dispute that?

8 A. No. I was not providing advice. I provided

9 advice on a case of Peruvian law.

10 MR. GRANÉ LABAT: We are going to reserve

11 our right to introduce an exhibit as impeachment

12 evidence against this Witness in response to what he

13 has just said, but we will come back to this issue

14 later in the course of today or tomorrow.

15 PRESIDENT MCRAE: I take note of that, and

16 just proceed with the examination.

17 BY MR. GRANÉ LABAT:

18 Q. In this same exhibit, let's go to Page 3.

19 We have another social media post from you. This is

20 in this case from Instagram; right?

21 Do you see it on the screen?

22 A. Yes, that's correct.

[Page 825]

1 Q. Do you recognize this user name as yours,

2 "expensive.lawyer"?

3 A. I'm sorry, I didn't understand.

4 Q. Do you recognize Instagram? I'm not an

5 expert on social media, but I understand that on

6 Instagram you will have an account, and people can

7 create their profiles and their user names, and the

8 question I'm asking you is very simple: Do you

9 recognize that user name, "expensive.lawyer," as

10 yours?

11 A. To recognize digital evidence, according to

12 the rules for digital media, you would have to tell me

13 when that snapshot was taken. Do you have the date?

14 Q. I'm the one asking the questions. Please

15 don't interrupt. You've heard the indications from

16 the President. I'm the one asking the questions. I'm

17 asking for something very simple.

18 Do you recognize this image on the screen?

19 A. No, because that no longer alineates

20 (phonetic) with what exists.

21 Q. Did you post an image of this kind to your

22 account, "expensive.lawyer"? "Yes" or "no."

[Page 826]

1 A. No, and I'll say why. That account has

2 changed.

3 Q. Did you at some point have an account with

4 this name, "expensive.lawyer", that was under your

5 control?

6 A. I had an account with that name, but it is

7 not an account that has that name at this time and has

8 not for several months.

9 Q. At some point you had that account; correct?

10 A. It's the same account with a different name.

11 Q. I think this is going to be a very long day

12 if you refuse to answer very simple questions that I'm

13 asking you.

14 Did you at some point have an account with

15 this name, "expensive.lawyer", which was under your

16 control? "Yes" or "no."

17 A. As I said before, it is the same account

18 that at some point had that name.

19 Q. Are you the person in the photo?

20 A. I'm sorry?

21 Q. Are you the person in the photo?

22 A. Yes, of course I am.

[Page 827]

1 MR. GRANÉ LABAT: Please, let's zoom out and

2 let's look at the document in the photo. We can zoom

3 in a bit. C-0107, "Legal Opinion of Dr Dino Carlos

4 Coria, Claimant's Memorial, SPA."

6 BY MR. GRANÉ LABAT

7 Q. Do you recognize this cover page? Have you

8 seen a cover page of this kind?

9 A. Yes, of course.

10 Q. Is that your Expert Report?

11 A. Yes, in fact.

12 Q. Did you take this photo?

13 A. Yes, I took that photo.

14 Q. Did you post this photo to your Instagram

15 account?

16 A. When I had that account with that name, yes.

17 Q. It was an effort, but we got there.

18 Do you know the rules about this or about

19 publicity regarding this Arbitration?

20 A. Let's see, sir, I would like to

21 clarify.

22 Q. I haven't even asked the question yet. Do

[Page 828]

1 you know the rules for publicity for this Hearing?

2 A. No, I don't.

3 Q. So, you didn't know that there are redacted

4 versions of the parties' pleadings that were published

5 in this case.

6 A. I don't understand your comment.

7 Q. So, you don't know that there are rules that

8 apply to this Arbitration regarding the redaction of

9 the documents by the Parties?.

10 A. What I do know is that there are

11 confidentiality rules, and that photo doesn't identify

12 the case or the proceeding.

13 Q. You're not answering my question.

14 A. I am answering because-

15 Q. You're not answering my question.

16 A. The world it's not always "yes" or

17 "no." Everything has an explanation, and the

18 context is important.

19 Q. You will have an opportunity to provide

20 explanations when the other Party asks the questions,

21 but please respect the instructions I gave you at the

22 beginning. Yes-or-no answers. It was a very simple

[Page 829]

1 question. I'm not asking you to tell me whether

2 Confidential Information is being divulged in this

3 image. The question is, again, whether you knew that

4 for this Arbitration there are publicity rules that

5 apply to the redaction of any pleadings that can later

6 become public.

7 A. I don't know about those rules.

8 Q. Did you ask the Claimant to redact your name

9 from the pleadings?

10 A. No.

11 Q. I would like to know about your area of

12 expertise. You talk about Peruvian procedural and

13 criminal law; correct?

14 A. Yes.

15 Q. And you've also explained in your two

16 reports that you have broad experience in legal advice

17 on criminal, criminal procedural and compliance

18 matters; correct?

19 A. Yes.

20 Q. In this case, you present yourself as a

21 specialist on Mining Law; is that the case?

22 A. Well, let me explain.

[Page 830]

1 Q. You can explain--you can explain, but first

2 I want you to give me the answer, then you can give me

3 the explanation.

4 A. I am an expert on criminal law, criminal

5 procedural law and I litigate on criminal mining law

6 for more than 20 years.

7 Q. You're not answering my question. I asked

8 you to please listen to my question. You are

9 presenting yourself in this arbitration as an expert

10 on Peruvian Mining Law?

11 A. No.

12 Q. Are you presenting yourself as a specialist

13 on Contract Law?

14 A. No.

15 Q. For your Second Report, did you review the

16 First Report of the Expert for Perú, Professor

17 Missiego?

18 A. Yes, that's correct.

19 Q. Did you also look at the exhibits to that

20 Report?

21 A. I didn't hear the last part.

22 Q. Did you also review the exhibits that were

[Page 831]

1 attached to that Report by Professor Missiego?

2 A. Yes, I did.

3 Q. Please wait until I finish asking the

4 question before you answer; otherwise, we won't have

5 the transcription--the Transcript.

6 In preparation for this Hearing, did you

7 look at Professor Missiego's Second Report?

8 A. Yes, that's correct.

9 Q. Did you also look at the exhibits of said

10 report?

11 A. Yes.

12 Q. Have you also reviewed Perú's

13 Counter-Memorial for this Arbitration; is that

14 correct?

15 A. No.

16 Q. Please, let's look at your Second Report,

17 Pages 10 and 11. We can show them on screen.

18 I would like to have greater clarity about

19 what you looked at because it's important, given it's

20 the basis of your analysis and your conclusions.

21 Down at the bottom, short answer on Page 10,

22 the section, it says: "The circumstances recounted in

[Page 832]

1 both KML's Memorial," they're the Claimant, "and

2 Perú's Memorial dated August 5th, 2022, and the

3 documents I have reviewed allow me to conclude," et

4 cetera.

5 Do you see that?

6 A. Yes, that's correct, yes.

7 Q. So, then you're referring to the

8 circumstances recounted in Perú's Memorial from

9 August 5th, 2022; correct?

10 A. Yes, that's correct.

11 Q. But you just said that you had not looked at

12 that brief.

13 A. You had not mentioned the date, that's why.

14 Q. There is only one Counter-Memorial.

15 A. Okay, then, I did review it.

16 Q. And have you looked at Perú's Rejoinder in

17 preparation for this Hearing?

18 A. Yes, I think I did. I'm not sure, but I

19 think I did.

20 Q. Don't you think you would remember whether

21 you read that pleading or not?

22 A. I've looked at many submissions, that's why

[Page 833]

1 I don't exactly remember. If you show it to me, I can

2 tell you.

3 Q. Yes, we can show it on the screen, but do

4 you know that at this Hearing there are two main

5 submissions by Perú, the Counter-Memorial and the

6 Rejoinder? Do you know that?

7 A. Yes.

8 Q. You don't remember whether you looked at the

9 Rejoinder which is the only other significant

10 submission by Perú?

11 A. Yes, I have, as far as I remember.

12 Q. So, if I ask you questions about the

13 information contained in that Rejoinder, you'll be

14 able to answer?

15 A. No, because I'm not its author.

16 Q. I'm not asking you to say that you're the

17 author. I'm just saying that if I make reference to

18 that Rejoinder, to information about Peruvian criminal

19 law and I ask you a question regarding that

20 submission, you can answer me?

21 A. I can give you an opinion, yes.

22 Q. And the documents you reviewed for the

[Page 834]

1 preparation of your Reports, are they all specifically

2 referenced in your two Reports?

3 A. Yes.

4 Q. Do you agree that if an impartial and

5 independent expert detects an error in the Report,

6 that person has a duty to rectify, to notify of that

7 and to rectify?

8 A. I'm sorry? Is that an opinion?

9 Q. If an impartial and independent expert

10 detects an error in the Report they have submitted to

11 Tribunal, do they have the obligation to say that and

12 to correct the error?

13 A. Obviously, to the extent that there is an

14 error.

15 Q. In preparing your First Report, did you look

16 at documents regarding the civil case initiated by

17 [Redacted] against Kaloti regarding Shipment 5? Did you

18 look at it?

19 A. Yes, the information that was given to me.

20 Q. And you referred in your report to the

21 record of that case. That was a civil case by [Redacted]

22 against Kaloti. I'm not going to give the file number

[Page 835]

1 because it's a very long number, but you refer to it

2 specifically in Paragraph 10.1 of your First Report.

3 A. Yes

4 Q. Can we please show it again on the screen?

5 It's the First Report, 10.1, Page 31 of the PDF. Can

6 we please zoom in a bit?

7 That's the record, and I would like to ask

8 you some questions about judicial sentences regarding

9 this. There is a place where you say [Redacted] instead

10 of [Redacted].

11 A. It is [Redacted].

12 Q. We understand that that's simply a

13 typographical error.

14 A. Yes, it is a mistake.

15 Q. But we're talking about the same thing, of

16 [Redacted]. Did you read the October 11, 2018 Resolution by

17 the Third Civil Court in this proceeding initiated by

18 [Redacted] against Kaloti?

19 A. It was an annulment, yes.

20 MR. GRANÉ LABAT: And that is Exhibit C-110

21 in this Arbitration, for the record.

22 BY MR. GRANÉ LABAT:

[Page 836]

1 Q. And you say in your First Report that this

2 Resolution settled the Appeal filed by Kaloti against

3 another decision of December 11, 2015, which in first

4 instance declared that there were grounds for [Redacted]

5 case or lawsuit against Kaloti. Remember? Is that

6 correct?

7 A. Yes.

8 Q. And for the benefit of the Tribunal, let's

9 please show C-110 on the screen. Let's go to Page 2.

10 This Decision of December 11th, 2015,

11 declared the termination of the Sales Contract for

12 almost 100 kilos of gold supplied by [Redacted] correct?

13 A. Are you referring to that First Instance

14 Decision?

15 Q. Correct.

16 A. Yes

17 Q. But that Resolution from October 11th, 2018,

18 did not declare that Kaloti was the owner of those

19 almost 100 kilos of gold; correct?

20 A. Yes.

21 Q. In fact, you, yourself, explain in Paragraph

22 10.1 of your First Report that the effect of this

[Page 837]

1 Resolution of October 11th, 2018, and I quote your

2 report, is that it said that another Judge would issue

3 a new decision?

4 A. Yes.

5 Q. And you're not wrong about this. Let's look

6 at 110, Page 7. Let's look at the Resolution, the

7 Resolutive Part. And let's go a little more slowly

8 because we have to highlight both the English and the

9 Spanish. We see there ordering the Judge to issue a

10 new ruling pursuant to the guidelines set forth in

11 this resolution".

12 Do you see that?

13 A. I do.

14 Q. This Resolution of 11 October 2018 did not

15 end the civil case between [Redacted] and Kaloti; correct?

16 A. Correct.

17 Q. On 23 September 2019, this Court handed down

18 another ruling, Resolution 46. This is R-213.

19 Do you remember this other Resolution of

20 September 2019?

21 A. I do. It was a new Resolution.

22 Q. Let us look at the Decision. We will show

[Page 838]

1 it on the screen.

2 Let me ask you another question before we

3 move on with this.

4 In your First Report dated [Redacted]

5 10 February 2022, you say that this Judgment of

6 September 2019 had not been notified to the Parties,

7 and you say that that's the reason why this ruling is

8 not efficient and it cannot be opposed to third

9 parties.

10 A. Can you show me the paragraph?

11 Q. Yes, it's 10.2, Page 32 of your First

12 Report.

13 And let's highlight where it says that

14 Decision has not been notified to the Parties of the

15 proceedings and, as such, is not currently effective

16 or enforceable. Do you remember that now?

17 A. Yes, I do.

18 Q. Then, you assert that as of 10

19 February 2022, when you prepared your Report, neither

20 you nor Kaloti had had access to this ruling and the

21 procedural paperwork related to it?

22 A. Correct.

[Page 839]

1 Q. Let us now look at R-216 on the screen.

2 What we have on the screen is an appeals by

3 Kaloti against this ruling of 23 September 2019.

4 Did you have knowledge of this appeal

5 submitted by Kaloti?

6 A. No. I didn't have any knowledge of it.

7 Q. Let's see when this pleading was received.

8 18 October, 2019.

9 Do you see that?

10 A. It's not easy to read, but it appears that

11 it says 2019. Well, the translation in English says

12 October 18, 2019, and the date stamp apparently

13 matches that October 18, 2019.

14 Q. The translation indicates October 18, 2019,

15 and the stamp seems to match, October 18, 2019. In any

16 case, this is a document submitted by Kaloti. We see

17 it on the heading. Here, we have the number.

18 By 18 October 2019, two years and four

19 months before the issuance of your First Report,

20 Kaloti had knowledge of this ruling of

21 23 September 2019, and it had also filed an appeal

22 against the ruling; correct?

[Page 840]

1 A. Let's see. Not necessarily. Why? Because I

2 don't know the origin of this document. I cannot

3 issue an opinion on a document I do not know. What I

4 do see is that one of the Parties is Kaloti Metals,

5 the other one is [Redacted].

6 So, it calls my attention how the State of

7 Perú is not a party to this case. So, how can this be

8 included in the Report of an expert for Perú? I don't

9 know if this document is truthful or if it was

10 obtained through the correct legal means. I could

11 make a comment if I'm sure of the origin of this

12 document.

13 Q. Are you putting into question the

14 authenticity of this appeal by Kaloti against a

15 resolution of a court in Perú?

16 A. I am putting--calling into question the

17 origin of this document. The document may be

18 truthful, but I don't know its origin. In Perú, a

19 lawyer would be liable if we make pronouncements in

20 connection with documents whose lawful origin has not

21 been verified.

22 Q. Now, did you ask Kaloti if it had appealed

[Page 841]

1 this ruling from September 2019?

2 A. I have not asked.

3 Q. Did Kaloti tell you that it had filed an

4 appeal? Please let me finish; otherwise, we're going

5 to miss the Transcript.

6 Again, did Kaloti tell you that it had filed

7 an appeal against this ruling of September 2019?

8 A. No. I was not informed of that.

9 Q. You didn't ask; right?

10 A. I did not ask, either.

11 Q. Didn't you think that this was relevant

12 information to ask Kaloti where it had filed an appeal

13 of this ruling that you said had no notice of?

14 A. No, because it wasn't conducting an

15 examination of civil-law matters or in connection with

16 this case. The mere existence of a court case that

17 discusses the potential termination of a contract,

18 already means that we have to accept that we need to

19 go to court to say that they're not the owners.

20 Q. In your Report, sir, you issue opinions in

21 connection with the legal consequences and the weight

22 and the validity of a ruling. You didn't think it was

[Page 842]

1 relevant to ask your client whether this is a final

2 ruling or where an appeal has been lodged?

3 A. As you said, my testimony has to do with

4 procedural law and criminal law. I'm not talking

5 about civil law.

6 Q. Again, in your report, you make reference to

7 this Judgment. You say it is final. You said that

8 you do not know what happened later, no notice was

9 given to you. You reached conclusions in connection

10 with the assertion that you make, and you didn't think

11 it was relevant to ask whether an appeal was filed

12 against this Judgment?

13 A. No, because I was asked to examine only what

14 happened up until 2018. What happened later on,

15 that's a different issue. It is incidental.

16 Q. Now, you said that you had no knowledge, you

17 had been provided no notice of this, and that neither

18 you nor Kaloti, your client, had notice of this

19 ruling. Now, this is an appeal by, Kaloti, your

20 client. This was notified on October 3rd, 2019.

21 Do you see that?

22 A. Again, I cannot rule on documents whose

[Page 843]

1 origin I do not know. I can read what the document

2 says. I can do that.

3 Q. You do see that this was notified on

4 October 3rd, 2019, on the basis of this document

5 included in the case file of this Arbitration, and

6 it's being shown?

7 A. No.

8 What I see here is a piece of paper with a

9 seal that says right here "we were notified."

10 Q. Again, sir, we're going to be here

11 for a long time if we cannot agree on a very

12 simple matter such as what a document says in

13 the file of this Arbitration.

14 A. Let's see.

15 Q. Do you see on this screen this document?

16 This document is in the file of this Arbitration, and

17 it says that on October 3rd, 2019, we were notified

18 via Resolution 46, and it says here that your office

19 has declared the claim to be founded in all matters.

20 A. That is what the document says.

21 Q. Very well. Let us try to make the next set

22 of questions easier.

[Page 844]

1 You said that you had no knowledge of this

2 appeal; correct?

3 A. Correct.

4 Q. And that you had no knowledge that Kaloti

5 had been notified of the Judgment that was subject to

6 this appeal.

7 A. Correct.

8 Q. Let us move on. You indicated in your First

9 Report when you said that the Judgment had not been

10 notified and that Kaloti had had no access to this

11 September 23rd Judgment. It says here you were

12 notified, "we were notified."

13 A. What page are you on?

14 Q. Paragraph 10.2, page 32.

15 You used the plural in your Reports. I

16 would like to know who drafted this Report? Because

17 you use the plural form.

18 A. Again, where are you looking at?

19 Q. We can show it on the screen and highlight

20 it. 10.2, and it is a parenthetical. Perhaps we're

21 going to show it to you on the screen.

22 "We, and KML (as we were informed..." close

[Page 845]

1 parenthesis, "...have not had access to the text of

2 that decision or its procedural documents".

3 Okay, I have two questions. You said that

4 "we were informed." What are you referring to?

5 A. I'm referring to my law firm, to me.

6 Q. Okay. You're referring to your law firm.

7 A. We were hired by WDA to prepare this Report,

8 so when I'm talking about us in the plural, "we" were

9 informed, I'm talking about my law firm.

10 Q. You're the author of the two Reports; right?

11 A. Yes.

12 Q. Did anyone else work with you?

13 A. Well, it was just me, but it's a way of

14 saying things in my country. We use the royal "we,"

15 if you will.

16 Q. Let us look at the decision that Kaloti was

17 appealing via that document we saw on the screen,

18 R-203. Please put it on the screen. R-213, rather.

19 Let us look at the Decision page 8 here of

20 this Judgment of 23 September 2019, and we see here

21 highlighted that the Judge decided to declare that

22 there were grounds for the claim and also that the

[Page 846]

1 Contract between [Redacted] and Kaloti was terminated.

2 Do you see that?

3 A. Yes, that's what I see here.

4 Q. This appeal by Kaloti was decided on by the

5 Third Civil Chamber on appeal via this Judgment R-212,

6 and it is dated 14 June 2022.

7 Let us look at Page 14 of that Decision,

8 which is R-212.

9 It says here: "It is resolved to confirm

10 the Judgment contained in Resolution 46 dated

11 September 23, 2009."

12 A. That is what the document says in front of

13 me.

14 Q. So, the Chamber confirmed the lower court's

15 Judgment that had decided that there was a termination

16 of the Contract between [Redacted] and Kaloti.

17 A. I'm sorry if I insist, counsel. I cannot

18 rule on documents whose origin I have no knowledge of.

19 Lawyers in my country would be held liable, criminally

20 liable, even, if we referred to documents the origin

21 of which is not known to us. Could you please tell me

22 what the origin of this is?

[Page 847]

1 Q. What do you mean by "origin"?

2 A. Well, I see reference here is made to two

3 parties to the proceedings, Kaloti Metals and [Redacted].

4 How is it that the State of Perú has this information?

5 Was there a consent by Kaloti or by [Redacted] for this

6 document to be shown and for me to rule on this

7 document with that bit of information?. Without that

8 information, I cannot really weigh on this, because

9 there would be doubts as to the origin and

10 authenticity.

11 In Perú, and I want to make that very clear,

12 there are actions against lawyers for corruption and

13 for violation of the attorney-client privilege when

14 they reveal information of a document and when they

15 cannot indicate the origin of the document. You show

16 me here documentation which origin I cannot explain or

17 give faith of its authenticity nor its origin, so

18 making a pronouncement would make me potentially

19 liable.

20 Q. This is a judgment handed down by the Third

21 Civil Chamber; right?

22 A. I don't know. I don't know what the origin

[Page 848]

1 of this document.

2 Q. Let us look at the heading. I think this is

3 going to be very difficult if you provide those kinds

4 of answers.

5 Again, this is a ruling by the Third Civil

6 Chamber. Are they public?

7 A. No.

8 Q. So, you cannot have any access to any of the

9 Judgment in the Judicial system in Perú...?

10 A. (inaudible).

11 Q. I haven't finished. You cannot access any of

12 the Judgments handed down by the Third Civil Chamber

13 of Perú unless you are the lawyer for one of the

14 Parties?

15 A. That is correct.

16 Q. Okay. Kaloti is a party to a proceeding.

17 Kaloti gives you a number of documents, but not

18 others. Is that what you're saying?

19 A. I'm not saying that. What I'm saying is

20 that I have had no access to this information.

21 Q. Did you ask [Redacted] permission to make a

22 decision on this 11 October 2018 Ruling?

[Page 849]

1 A. That's not necessary because Kaloti is my

2 client through WDA. It is Party to those proceedings.

3 Q. Kaloti is also Party to these proceedings.

4 A. Yes, of course, it is.

5 Q. Kaloti did not provide to you this Judgment.

6 A. I have not seen this Judgment. That's my

7 answer.

8 Q. Okay. So, Kaloti didn't provide you with

9 this Judgment, okay. I understand.

10 Based on we see on the screen--and I'm not

11 asking you to certify the authenticity of a document

12 that was not provided to you by your client, but

13 evidently this is part of a case file, and your client

14 is a party to that proceeding, based on the Decision

15 made by the Chamber. It says here that it confirms

16 the Judgment contained in Resolution 46 of

17 23 September 2009, so then the Contract was terminated

18 between Kaloti and [Redacted].

19 A. I cannot rule on documentation, the origin

20 of which I do not know. The State of Perú is not a

21 party to those proceedings. I'm being shown a

22 document by a party that was not a party to those

[Page 850]

1 proceedings, so this would entail professional

2 liability for me.

3 Q. You've said that. Do you know where

4 Mr. Missiego refers to this in his First Report?

5 A. He mentions this in his Second Report.

6 Well, maybe in the First Report, I don't know, the

7 First or Second.

8 Q. I'm telling you it was the First Report,

9 sir. I can show it to you. Do you remember the

10 Professor Missiego made reference to this in detail,

11 in some detail in his Report?

12 A. Could you please show that to me?

13 Q. Yes, of course.

14 Let's look at Paragraph 149, 149 to 151, and

15 then the conclusions in 152.

16 You see that reference is made of this

17 Judgment of 14 June 2022.

18 A. Yes.

19 Q. Do you not see this in Mr. Missiego's

20 Report?

21 A. Yes.

22 Q. Didn't you think it was important to refer

[Page 851]

1 to this in your Second Report and in your presentation

2 today?

3 A. No, because I'm not conducting an analysis

4 on the Civil Judgment handed down in that case. When

5 I read this in Mr. Missiego's Report, it struck me how

6 is it that Mr. Missiego had information of a case of

7 which he is not a party? This is a case between

8 Kaloti Metals and [Redacted]. The State of Perú is not a

9 party to those proceedings. That is what Mr. Missiego

10 asserts and he is going to explain then the origin of

11 the document.

12 Q. You insist that you have not been called to

13 give an opinion on this, but you did give an opinion

14 on the effects of a Civil Judgment. Then you issued

15 an opinion in connection with the Civil Judgment, but

16 when I asked you about another proceeding, then you

17 said that you cannot opine on it. Am I understanding

18 this correctly?

19 A. No, you're not understanding this correctly.

20 When I examined this initially in my First Report, I

21 had access to the first ruling, but I cannot issue an

22 opinion on documents in the same case when the origin

[Page 852]

1 is not clear. This would entail for me criminal

2 liability if I then issued an opinion on that.

3 Q. Okay. I think it's clear now of what you

4 received, what you didn't receive, what your client

5 provided to you, what it didn't, and you considered

6 that this limits your opinions.

7 Okay. Let's move on.

8 You're an expert on compliance; right?

9 A. Well, yes, but I haven't prepared a report

10 on compliance. I have prepared a report on criminal

11 and criminal procedure law.

12 Q. Okay, very well. Let's look at the Second

13 Report, paragraph 4.2, page 12.

14 A. First or Second Report?

15 Q. The Second Report.

16 A. What page?

17 Q. Page 12, Paragraph 42.

18 And here it says of the documents that were

19 provided in the case file of this arbitration, and

20 that we were able to examine to prepare this Report,

21 we were able to conclude that Kaloti took all the

22 Measures it had at its disposal to avoid enter into

[Page 853]

1 contracts with illegal gold Suppliers. Let us see

2 what the Measures taken by Kaloti were.

3 But, before we do that, and before we look

4 at the facts, I would like to understand what Measures

5 you, as a legal expert and as a compliance expert,

6 consider should be taken by a purchaser of gold. If

7 you were to provide advice to a client that tells

8 you--that want to purchase gold, you're going to then

9 perhaps ask the Client a number of questions; right?

10 And you can say, "okay, I can tell the Client this or

11 this or it's not necessary, et cetera." Would you

12 advise the client to verify the origin of the ore?

13 A. I'm not understanding your question. You're

14 asking me questions as a mining law expert, as a

15 compliance expert, as a criminal law expert?.

16 Q. Well, I'm asking you in your areas of

17 expertise. The ones you just said and the ones you

18 said in your report which was the condition in which

19 you were appearing in this arbitration.

20 A. Okay. Let me try to answer your question.

21 I provided a criminal law report and criminal

22 procedure. I am not an expert in Mining Law. I'm not

[Page 854]

1 an expert on Contract Law. I'm a compliance expert,

2 but my Report is not a Compliance Report.

3 But I can answer your question on the basis

4 of my experience.

5 Q. I'm asking you about your conclusions in

6 both of your Reports. We were able to conclude that

7 Kaloti took all the Measures available to it to avoid

8 contracting with Suppliers of illegal gold. So I want

9 to understand, in your opinion, what Measures Kaloti

10 took to make sure of that.

11 As a legal expert that reached this

12 conclusion, let me ask you this: If you have a client

13 that asks you for advice as to the Measures it has to

14 take to make sure of the origin of the gold, would you

15 advise to the Client to determine the origin of the

16 mineral?

17 A. Yes. That's fundamental.

18 Q. Also to ask for the RUC or identity

19 documents of the Seller?

20 A. Yes. Because of "know your client," you

21 need to have that information.

22 Q. Okay. So, your answer is "yes."

[Page 855]

1 A. Yes.

2 Q. Also the date of the mining concession from

3 which the ore comes?

4 A. That depends.

5 Q. Okay, "depends." We'll come back to that.

6 The authorization to operate that mining

7 concession?

8 A. Depends.

9 Q. Okay, "depends" again.

10 The payment vouchers for the ore?

11 A. That depends on what do you call payment

12 vouchers.

13 Q. Okay. Weight, characteristics of the ore?.

14 A. That's something fundamental in a purchase

15 and sale, the identification of the good.

16 Q. Okay. And then the waybill and the

17 transportation used?.

18 A. That depends.

19 Q. What about keeping a record of all of the

20 information and the documents?

21 A. Yes, of course.

22 Q. Were you familiar with--and let's put on the

[Page 856]

1 screen R-49.

2 This is Legislative Decree 1107. You're

3 familiar with this Legislative Decree; right?

4 A. Yes.

5 Q. And Article 11, you're familiar with it, of

6 course?

7 A. Yes. Of course.

8 Q. You do not cite this Article in any of the

9 Reports.

10 A. I have not provided a report on Mining Law.

11 Q. But you do know what Article 11 says.

12 A. Yes, of course.

13 Q. And all of the information that I indicated

14 to you, that's expressly shown in Article 11.

15 A. Can you please show it on the screen?

16 Q. Now, this is important, and I'm going to

17 read it for the record, and we need to contrast this

18 with what Kaloti does. "All purchasers of mining

19 products subject to control and supervision in the

20 framework of this Legislative Decree, regardless of

21 their condition, whether the acquisition is made

22 temporarily or permanently, must verify the origin of

[Page 857]

1 such products, requesting the relevant documents, and

2 it must verify the authenticity of the data recorded

3 in the relevant information systems."

4 "The minimum data to be verified will be the

5 following: RUC, company name, given name and last

6 name, identity document, actual address of the Seller

7 of the mineral, unique Concession Code and its

8 validity from where the mineral comes from, and

9 exploitation authorization, the data contained in the

10 payment vouchers specifying their description and the

11 data of the traded good (weight, characteristics and

12 condition), and also data on the waybill and identity

13 of the carrier."

14 This is the framework, the context that I'm

15 giving you. Let us look at the Measures that Kaloti

16 took and that are included in the file and that you

17 said you reviewed.

18 You said that Kaloti--and, of course, I'm

19 making reference to Paragraph 4.2 of your Report, your

20 Second Report, Page 12, you said Kaloti invested time

21 in talks, seminars and trainings for Kaloti's team

22 members. And also it used resources for Compliance

[Page 858]

1 Programs and for the detection of AML.

2 And you cite six exhibits here. Let us look

3 at C-25, first. You cite six exhibits. This is the

4 AML/CFT program. Do you remember that?

5 A. Yes.

6 Q. You reviewed this; right?

7 A. Yes.

8 Q. So, you know what Kaloti said should happen

9 internally.

10 A. Yes.

11 Q. Do you know the date of this Manual?

12 A. I do not recall the date.

13 Q. Please let's highlight it on the screen.

14 A. Yes.

15 Q. Did you see a Compliance Manual by Kaloti of

16 a different date?

17 A. No. That's the one I've seen.

18 Q. You don't know whether there was another

19 Compliance Manual that Kaloti had before this date?

20 A. No.

21 Q. So, you haven't looked at any other--you

22 haven't been provided with any other Manual?

[Page 859]

1 A. No.

2 Q. Do you remember the date of the Five

3 Shipments, the subject matter of this Arbitration?

4 A. Yes, I remember.

5 Q. Let me repeat because I was told, it seems

6 that it's not on the record.

7 So, the date of the compliance manual is 2018, based

8 on what I see here on the screen and that Mr. Coria

9 confirmed, and again this is an attachment to his

10 Report, an Annex to his Report, and this is a Manual

11 in English, but you're telling me that you understand

12 English.

13 A. Yes.

14 Let us look at the second document, C-26.

15 MR. GRANÉ LABAT: We don't have this in

16 Spanish. I am being told that the cover page in

17 Spanish is not any different, and let's see what it

18 is.

19 BY MR. GRANÉ LABAT:

20 Q. And this is what you are citing in your

21 Report, and the Investment of Kaloti in training,

22 staff training. Let's see what we find. We see here

[Page 860]

1 a picture of Mr. [Redacted], and I assume other

2 representatives from the Kaloti firm. We also see the

3 logo, this seems to be a public event. We see some

4 people having a conversation, smiling. And then we

5 have some electronic emails, invoicing in connection

6 with the cost of Kaloti's participation in that

7 symposium.

8 Do you recall that?

9 A. Yes.

10 Q. And the date of the symposium, if we go to

11 Page 8 in the PDF, Page 8, let's see if we can

12 increase the font. The email, that is again--let's

13 see who is sending this. This is Kaloti Metals. This

14 was sent March 21st, 2014, and this is referring to a

15 symposium in Perú, and it is saying also sponsorship

16 payment, and here it says [Redacted], we understand is

17 [Redacted], who is an official with Kaloti and it

18 says information for the first payment for the

19 May 2014 symposium, but then there is "exhibition" as

20 a note. They rather clarified that this was an

21 exhibition.

22 Do you see that?

[Page 861]

1 A. Yes.

2 Q. And now, let us look at another Annex, and

3 that is C-29. You also cite this in your Report.

4 Once again, I understand that the cover pages are the

5 same. And here is says "Kaloti assaying operations of

6 gold and silver in Peru". And if we scroll down, we

7 see some individuals in an office. We do not see

8 their faces. We see some gold ingots.

9 Do you recognize these pictures?

10 A. Yes. They are the ones that I saw before.

11 Q. Do you know who these individuals are?

12 A. I understand that they are SUNAT's

13 officials, are they?.

14 Q. I don't know. I'm asking you.

15 A. I would say so, yes.

16 Q. So, you are the one who attached these

17 pictures to your Report, so I assume you are familiar

18 with this?

19 A. I understand that that would be the case.

20 Q. So, you understand that they would be

21 SUNAT's officials.

22 A. Yes.

[Page 862]

1 Q. Where were these pictures taken?

2 A. I do not know.

3 Q. But this is an attachment to your Report.

4 You did not ask your client before attaching this?

5 A. This is at the warehouses.

6 Q. At the warehouse.

7 A. I understand that the Company had the

8 warehouses in Hermes.

9 Q. So, this is Hermes' deposit warehouse;

10 correct?

11 A. Yes.

12 Q. What date were these pictures taken?

13 A. I don't know the date of this picture.

14 Q. So, you do not know whether these pictures

15 were taken, for example, in 2018, could it be?

16 A. I do not know.

17 (Pause.)

18 Q. Let us now look at the other annexes that

19 you referred in this paragraph.

20 PRESIDENT MCRAE: Are you moving to another

21 topic? Because we should be taking a break around

22 now.

[Page 863]

1 MR. GRANÉ LABAT: I think we can take the

2 break now, Mr. President, because I anticipate that we

3 will spend some time on the other annexes that we have

4 here. Thank you.

5 PRESIDENT MCRAE: All right. Let's take a

6 break for 15 minutes.

7 And Dr. Caro, you are giving your testimony

8 and, therefore, according to your Declaration, you

9 should be independent and, therefore, cannot make any

10 contact with members of the Claimant's team. In fact,

11 I think there is a room, if you can be taken to so you

12 can get coffee and whatever you need to refresh

13 yourself. But we're back in 15 minutes.

14 THE WITNESS: Thanks.

15 (Recess.)

16 PRESIDENT MCRAE: I think we're ready to

17 resume; but, in doing so, I would just like to

18 reiterate that the interpretation is having a lot of

19 difficulty because you're speaking together at the

20 same time. I'd really ask both counsel and the

21 Witness to pause after you've heard a response before

22 you ask the next question or before you make a

[Page 864]

comment, wait after the question, Dr. Caro, wait after the question for a short time so the interpretation can finish. Otherwise, the interpretation is about three or four sentences behind what is actually happening between you, so it would certainly assist us if could try to remember. I know it's difficult. I understand it's not an easy thing to do, but please try.

Thank you.

MR. GRANÉ LABAT: Thank you, Mr. President.

My apologies to the Tribunal, the Interpreters and the Court Reporters, I will do my best. And it often happens when you speak the same language with the Witness or the Expert, so my apologies. Please do shout if I'm not able to adhere to that rule.

Let me move on to Spanish.

BY MR. GRANÉ LABAT:

Q. We were going into some questions about what you said at Paragraph 4.2, we see a list of exhibits that you were referring to, to premise your conclusion. But, before continuing with that line of questions, I would like to go back briefly to

[Page 865]

something that you said in response to this Decision by the Civil Court, you said you didn't see it because your client did not share with you the Decision or the Judgment, rather..

I asked you, "is this a judgment by the Third Chamber of the Civil Court? Are these Judgments public?" And you said "no." And I asked you: "You cannot have access to any Judgment by the Third Chamber of the Civil Court if you are not an attorney for any of the Parties?" And you said: "That is correct." And this is at 10:14 this morning in the Transcript. And I would like to understand this better.

Are you familiar with the "consulta de expedientes judiciales" ("consultation of judicial files")? As a matter of fact, you referred to that software to consult decisions, judgments, and you refer to that at 10.2 in your Report. Did you have access, or did you use that tool to consult these legal judgments?

A. Could you please repeat your question?

Q. Since you did not have your mic on, I do not

[Page 866]

think that they recorded your answer. I need to go back to the first question.

My question is whether you are familiar with the system called "consulta de expedientes judiciales" ("consultation of judicial files")? The software to consult, to query legal judicial judgments.

A. Yes.

Q. And you referred to this at Paragraph 10.2 of your First Report.

A. Yes.

Q. Now, my question is whether you entered into that or you logged into that system before preparing your Report.

A. Sorry, were you referring to 10.2 in my Report?

Q. Yes, from your First Report.

A. Where?

Q. We can show it on the screen, but it's the part that starts with: "it is important to know that as a result of the inquiries made regarding..." etcetera.

A. Yes.

[Page 867]

Q. Then you inquired about this File 15.8.8.3, and to that end, you used the computerized system of the Superior Court of Justice of Lima; correct?

A. Correct.

Q. And based on that inquiry, you heard of that Judgment of September 23rd, 2019?

A. Correct.

Q. And anyone in Perú may log into this system to check; correct?

A. It depends.

Q. What does it depend on?

A. Let me explain to you: Judgments, criminal judgments, are public. Civil-case judgments are not public. They are only known to the Parties. And even though the system may be used by third parties, that does not mean that the decisions are public. So, there is also a security breach that several counsel have mentioned. There is not something that is normal, for anyone to have access to information in connection with the file in which they are not a party. That's what I mean and why it depends.

Q. Let's try to be specific. We're talking

[Page 868]

about 15883, that file, the first part. You said you made inquiries on that.

A. The second part, yes. Correct.

Q. You said you conducted an inquiry on that. That's the second part.

The third part is that you found out that, on 23 September 2019, a judicial sentence was issued in the context of that file. Do we agree so far?

A. That's correct.

Q. So, you did have access to this inquiry system regarding judicial decisions issued in the context of this file; correct?

A. Up to that point, yes.

Q. If you were to enter into this file consultation system right now, would you be able to find judgments from that same Third Chamber in the context of this file for after September 23rd, 2019?

A. It's probable. It's likely.

Q. If we were to enter into the website of the system now, do you know whether we would find judgments from after September 23rd, 2019?

I'm not done yet.

[Page 869]

A. I'm sorry.

Q. You don't know if there would be decisions from after 23rd September 2019? That's what you say?

A. That's correct.

Q. Well, we could do that exercise. We could go on to the website and do a search for those judgments. That's something that I'm proposing for the consideration of the Tribunal as well as for the consideration of the other Party.

MR. DÍAZ-CANDIA: That would be actually taking of evidence, practicing evidence during the Hearing, and then we will have no way of controlling or exercising or right to due process on that evidence. This Hearing is for witnesses and experts, not for actual taking of evidence that is not on the file.

(Tribunal conferring.)

PRESIDENT MCRAE: I'm not sure that it is doing anything other than checking what is said in this his Report, but on the other hand I'm not sure that I think it's really necessary to do that. I understand what he said, I understand the questions,

[Page 870]

and you can both draw the conclusions you like in your concluding statements about what the Witness has said, and the implications of it, but I don't think we need to go through that test. Thank you.

MR. GRANÉ LABAT: Thank you very much, Mr. President. As always, we are happy to defer to the Tribunal, and we will, therefore, move on. We will not insist that therefore ongoing line based on those considerations of efficiency.

Thank you.

BY MR. GRANÉ LABAT:

Q. Let's go back, then, to the Second Report Paragraph 4.2, Page 12. We have seen some of the exhibits already. Let's take a look at some of the other ones.

You say--and here is the text for it--that KML investigated--again, I'm sorry, I was referring to Kaloti. "Kaloti investigated the gold Sellers and requested documents regarding the origin of that gold." That's the end of the quote. And then, you cite some of the exhibits, and I would like us to continue to look at them.

[Page 871]

The first one is C-127. Please show it on the screen. And as you can see, here, if we scroll down a bit, please, these are certificates of deposit in the custody of CONABI and the documentation for the delivery of the gold shipments. And it says that these were issued by the Banco de la Nación as a consequence of SUNAT's Immobilization of Shipments 1 through 4; correct?

A. Yes, that's what I see.

Q. And for the benefit of the Tribunal, can you explain what CONABI is, not the explanation of what the institution is but what the abbreviation refers to?

A. I don't remember exactly, but they are in charge of the management of seized goods.

Q. It's the National Commission of seized goods. Now, you will agree that this document is not related to the alleged investigations or research by Kaloti regarding the Sellers of the gold or the origin of that gold; correct?

A. This document is related to custody.

Q. Okay. Let's show on the screen another

[Page 872]

document you cite, C-130. These are documents on due diligence prepared by Kaloti regarding the Company known as "[Redacted]" And, as you probably know, they delivered Shipment 2; is that correct?

A. Yes, that's correct.

Q. And the exhibit you see on the screen contains three documents. Two are IDs of Shareholders of [Redacted]--and here, we can scroll down slowly on the screen--and the RUC of that company.

A. That is correct.

Q. And, for the record, that is Perú's Taxpayer Unique Registry.

A. Yes.

Q. This Exhibit C-130 contains waybills for Shipment No. 2?

A. I'm sorry, what's the exhibit?

Q. It's C-130. It contains waybills for Shipment 2?

A. No.

Q. Okay. It contains or indicates the Concession Code for the mines from which Shipment 2 was coming?

[Page 873]

A. No.

Q. Does it contain the authorization for the operation of the mines from which Shipment 2 supposedly was extracted?

A. No.

Q. Does it contain the environmental certification for the mines?

A. No.

Q. It has no information regarding the origin of the gold contained in Shipment 2 to show and demonstrate its origin?

A. I didn't understand the question.

Q. Does it contain a document to provide support for the origin of the gold in Shipment 2?

A. No. These are ID documents for [Redacted] staff.

Q. You say you reviewed the documentation in this file. Do you remember seeing some communication, any documents that show that Kaloti requested information about the origin of Shipment 2?

A. As I've mentioned, it was not a report on compliance that I provided. I did not look for that

[Page 874]

information because it wasn't the subject of my Report.

Q. But, in your Report, you reached conclusions regarding the origin of the gold and the due diligence conducted by Kaloti, and you conclude that that due diligence was adequate, satisfactory, and complies with Peruvian law, so I ask you: In order to reach those conclusions, did you ask Kaloti and have you seen in the record for this Hearing any request by Kaloti for information regarding the origin of the mine--of the gold in Shipment 2?

A. Which one are you referring to?

Q. Well, we're still on Paragraph 4.2 of your Second Report. Toward the end of the paragraph it says: "KML also investigated the Sellers of the gold and requested documents on the origin of the gold." That's your conclusion, as I understand?

A. Yes. Correct.

Q. And you made that based on documents you reviewed?

A. Yes, that's correct.

Q. And you cite the documents on which

[Page 875]

you based that conclusion; correct?

A. Yes, that's correct.

Q. Then the question--I will repeat the question--is: In order to reach that conclusion, did you obtain any documents supplied by Kaloti that shows that Kaloti requested information to prove the origin of the gold in Shipment 2?

A. In addition to the documents that are mentioned here, let's remember that there's more information regarding the customs process that had begun, so we need to take into account also that set of documents that is in the corresponding records.

Q. But that wasn't my question. I'm asking you about what you're citing here as the basis for your conclusion. Let's continue looking at other documents, but what I'm asking is for you to tell me whether you got from Kaloti any information that shows that Kaloti asked [Redacted] to prove the origin of the gold that was contained in Shipment 2.

A. No.

Q. Okay. Let's look at another example that you cite, Exhibit C-132. These are due-diligence

[Page 876]

files prepared by KML for the [Redacted] Company. As you know, that was the Supplier of Shipment 3. Do you remember?

A. Yes.

Q. This exhibit--and we will show it on the screen--let's please go to Page 7--it includes a declaration of commitment related to the mine from which the gold in this Shipment 3 was allegedly mined. And it is under the name of "Manuel Valdiviezo Guevara." Correct?

A. Yes, that's what I can see there.

Q. And that exhibit also contains a copy of the RUC, the taxpayer registration of [Redacted], listing representatives and other people connected to the Company? Correct?

A. Yes.

Q. And Mr. Manuel Valdiviezo Guevara is not shown here. His name is not here as a representative of [Redacted]; correct?

A. Correct.

Q. When you look at this document, when you reviewed it, did you notice that the titleholder

[Page 877]

supposedly for the mine, the person under whose name it was, was not related to [Redacted]?

A. Is that a question or a statement?

Q. It's a question. You can answer "yes" or "no."

A. Can you repeat the question?

Q. When you reviewed this document, did you notice that the person, under whose name the mine supposedly was, doesn't seem to have any relationship with [Redacted]?

A. Can we look at the document again?

Q. Yes, we can do that, and you can adjust the speed through it--which we go through it.

A. Yes.

Okay. I see it, yes. He does show up there, if I'm understanding correctly, as someone linked to the Concession.

I'm sorry, just so I can answer your question.

Q. Yes, I'm talking about links to [Redacted].

A. Let me look at the entire document, please.

(Witness reviews document.)

[Page 878]

A. Yes, that's correct, yes.

Q. Okay. The question refers to him being shown as being linked to [Redacted]; is that the case?

A. Not on this document.

Q. This is a taxpayer registration--I think it's Page 18--gives a starting operations date for [Redacted] of June 7th, 2013; correct?

A. Give me a moment, please.

(Witness reviews document.)

A. That's what the document says, yes.

Q. And that's just seven months before Kaloti allegedly acquired Shipment 3; correct?

A. Yes.

Q. Let's briefly go back to the Compliance Manual you reviewed and that you cite in your Report as a basis for your conclusion. That was C-25. Let's go back to it.

You remember that Compliance Manual--and I can show you the page--identified a red flag, if the Supplier company was of recent creation. Do you remember that?

[Page 879]

A. Yes.

Q. Okay. Then there is no need to show it on the screen.

And the single taxpayer registration, the RUC shows that [Redacted] had not had any foreign trade activities.

Do you see that?

A. Where is it, please?

Q. On the right of the screen. We will highlight it on the screen. It's in two places. We're showing the first part, and it's highlighted on the screen, where it says "sin actividad," no activity.

We can also go to the next-to-last page, please. Agustin, there on the right, also says foreign trade activities "sin actividad," no activity.

A. Yes, correct.

Q. And you recall that the Compliance Manual of Kaloti established as another red flag lack of experience of the Supplier?

A. Yes, correct.

Q. Very well.

[Page 880]

You conclude, or you consider--and correct me if that's not your opinion--that there were slight indicia, slight indications--that's something you use--of the illicit origin of the gold, and these were used to justify the seizure, and I'm telling you this because I have a question about this. Is that your opinion, that the indicia were slight?

A. Yes, that's correct.

Q. And you reviewed each one of the judicial Decisions in the Criminal Proceedings against the Suppliers before reaching that conclusion?

A. I reviewed the information that is attached. For my First Report, I reviewed partial information. For the Second Report, based on the information in the Report of the Peruvian Expert, I've been able to look at a very orderly sequence of each one of the Decisions issues at the administrative and at the judicial levels.

Q. Let's go, then, to some of those decisions, and just to understand what it is that you looked at.

Have you looked at judicial decisions for the preliminary seizure action during the Preliminary

[Page 881]

Investigation phase?

A. Yes, that's correct.

Q. And you saw also the Orders for beginning a Preliminary Investigation in the four proceedings?

A. Yes, that's correct. All of those were attached to the Report by the Peruvian Expert.

Q. Fine, but I don't think that has any relevance to what we're talking about, whether it was attached by Professor Missiego or not to his Report has nothing to do with whether you looked at these exhibits.

A. Yes, I've reviewed them as exhibits. That's correct.

Q. Let's look then at some of the ones that you've reviewed. Let's look at the Order to initiate an investigation for the Criminal Proceeding against [Redacted] and its representatives. That's Exhibit R-145.

On Page 3 of that judicial decision, there is a section on indicia found in the inspection and/or verification of the documentation submitted by the Company, [Redacted].

Do you see that?

[Page 882]

A. Yes, that's correct.

Q. And, on Page 4, this Criminal Court explains--and I'll read it, but I will wait until we can see it on the screen, and I will read it slowly for the Interpreters.

You see that the purchase of the acquisitions was not done through the financial system, so they have not entered the bank system, as we can see in the following table. And there is a table, and it shows eight transactions that were not done through the bank systems for over three-and-a-half million dollars.

Do you see it?

A. Yes.

Q. And you see on the next page, there's an explanation that Peruvian law establishes that operations for an amount greater than PEN 3,500, that's the equivalent of about $1,000, must be recorded in the financial system through means of payment.

Do you see that?

A. Yes.

[Page 883]

Q. Again, with what the Court is telling us, on Page 7, there is a list of those people who supposedly mined that gold from mining concessions and delivered it to [Redacted]. Let's look, for example, at the name of one Seller, Roberto Carlos Paría Navarro, who supposedly mined and sold 12,257 grams of gold to [Redacted].

Do you see that on the screen?

A. Yes, that's correct.

Q. And on Page 9, continuing with this Order, there is a reference to the Witness Statement of this alleged Seller, Roberto Carlos Paría Navarro. Do you remember what his statement was?

A. Let me read it, please.

(Witness reviews document.)

Q. And if that makes it easier for you, I can tell you. If you don't remember--because this is not a test of your memory, Mr. Coría, so if at any time you need me to show a document, I can do it.

A. Okay. I read it.

Q. This man who supposedly sold gold to [Redacted], who later sold significant amounts to Kaloti, says

[Page 884]

neither the signature nor fingerprint that appear in the Declaration of Commitment Form filed with the DREM, which was shown to him, belonged to him. So, that's his statement, he says it did not belong to him.

And I'll ask you, when you answer my questions, to say "yes" or "no." Because if you say um-hmm, then that can't be recorded.

A. Yes, I understand.

Q. And, in fact, this man, Mr. Paría, says that he has not been involved in any mining activity; is that correct?

A. From what I see here, yes.

Q. Let's look at another alleged Seller.

René Luis Huamán Talla. He says that the signature and the fingerprint on the Declaration of Commitment Form filed by [Redacted] is his--he says that neither one is his.

Do you see that?

A. Yes, I see that.

Q. And I'm spending some time on [Redacted] because [Redacted] is a significant Supplier in terms of volume.

[Page 885]

On Page 11, we see a reference to another--Witness Statement by another alleged Seller, Delfín Germán Calapuja Mamani. Let's look at the second bullet point under that statement, and it starts with "His Godfather."

"His Godfather told him they were going to Puno, not telling him why, but he traveled with him and they went to the Office of Energy and Mining," and in said commitment document, "it reported that I had extracted gold from the mining Concession 'Medalid IV,' which had then been sold to the Company [Redacted], [Redacted], stating that I do not know this place."

That is to say, even the alleged Sellers to [Redacted], regarding Shipment 2, have declared that neither one of them had mined gold from that mining Concession, and that in some cases their signatures and their fingerprints had been falsified, had been faked, and the Seller admitted that he wasn't even familiar with the mining concession from which, supposedly, he had extracted that gold.

A. Correct.

Q. And then on Page 12 of that same decision,

[Page 886]

you see that the Court refers to the fingerprint report, Expert Report, issued by the Office on Criminal Science.

A. Correct.

Q. And that test conducted by authorities concludes that there is nothing that corresponds to these people, Roberto Carlos Paría Navarro or the others, which means that the names have been replaced in order to be able to file before ICA that Declaration of Commitments to justify or support in some way a legal origin for the seized gold.

So, this concludes that the documents that were provided to the Authorities by [Redacted] were not authentic, which confirms what was stated by the alleged Sellers; correct?

A. That's correct.

Q. And this that we have seen in this legal order that you've reviewed and you cite in your Expert Opinion, this did not come from SUNAT; correct? These were not documents that SUNAT took. They did not take the Witness Statements, they did not conduct the expert tests on the fingerprints or anything; correct?

[Page 887]

A. I'm sorry, the documents and the files to which they refer are from the Prosecutor's Office, Public Prosecutor's Office, not before a judge.

Q. Thank you for specifying that.

On Page 15, number 3.5 of the same Order regarding [Redacted], the Court refers to a document sent by the Regional Office on Energy and Mines of Puno.

You know Ica and Puno are two different regions. Correct?

A. Yes, of course.

Q. Do you know the distance between the two regions, approximately?

A. Not exactly.

Q. Do you think it might be hundreds of kilometers or thousands of kilometers?

A. Hundreds of kilometers between them.

Q. 400, 500?

A. 500, maybe a little bit more.

Q. This is not a test of your memory nor is it a geography test. We just wanted to know approximately, so for this distance you might need to drive 17 hours?

[Page 888]

A. Or one hour in a plane.

Q. Or one hour in a plane.

So, I was saying that we'll go to Page 15, No. 3.5. I was saying that the Court refers to a letter by the Directorate of Energy and Mines of Puno, and they conclude that "Medalid IV," this mining concession, has not been operating since October 26, 2012, so it's highly unlikely that any gold was extracted from that Concession. Do you recall that?

A. Yes, I remember.

Q. It says also that, even more so, in the unlikely assumption that--that is to say, assuming that it wasn't canceled--if gold had been extracted, that extraction will fall within the scope of the crime of illegal mining.

A. Let me read it, please.

Q. Page 15, Paragraph 3.5.

A. Could you please scroll up. I wanted to know how 3 begins, how Section 3 begins. I want to see how Section 3 begins, the first paragraph of Section 3.

Yes, that's correct. Right.

[Page 889]

Q. Very well. I'm glad that you took us to this paragraph, sir. It says: "To date, the legal origin of the gold ore subject to seizure has not been proven as documented from documentation collected and procedures carried out at the police headquarters,"

"[Redacted] HAS FAILED TO PROVE THE LEGAL ORIGIN OF THE GOLD ORE SUBJECT TO SEIZURE." And that is the heading that is the beginning of all these pieces of evidence.

A. Yes.

Excuse me, just a small favor. Could we look at the very beginning of this resolution?

Q. Yes, of course.

A. (Pause.) Yes, that's right. I just wanted to have context.

Q. Yes, of course. It's important.

Let us look at the [Redacted] proceedings and the Order opening the investigation. Here, it says that there are pieces of evidence that related to the accused. Let us now go at Page 14.

There, the Court is making reference to an inspection it conducted in the "Mi Buena Suerte"

[Page 890]

Concession. And [Redacted], as you remember, is Shipment No. 1. Reference is made to the "Mi Buena Suerte" Concession Area. This mine, "Mi Buena Suerte," is the mine that was the origin of the gold in Shipment No. 1. This is what [Redacted] has said.

A. Yes, I recall that.

Q. Now, the Court indicated that, during the inspection, no workers, equipment, or means of transportation were found carrying out mining activities in the "Mi Buena Suerte" Mining Concession. This is at Page 14. I just read that quote.

Do you see that?

A. One moment.

Q. My colleague is highlighting it in the Spanish. This is Page 14.

A. Yes, correct.

Q. It also explains that there are no tailings, residues or metallurgical processes that prove that gold ore has been processed in the inspected area.

Do you see that?

A. Yes, I read that.

Q. The Court included as another indicia, as a

[Page 891]

fact that has been evidenced, in connection with the Declaration for 2013 and 2012, that the Concession, "Mi Buena Suerte," had been declared as a concession with no mining activity; correct?

A. Yes, that's correct. That's what I read.

Q. I'm going to ask about the purpose of the seizures. We cannot, of course, look at every single piece of evidence in the case file but you have done it, as you said in your Reports?

A. Yes, correct.

Q. In your Second Report, you say that the gold is being kept by Perú. This is in your Second Report. I can show it on the screen. If I misquote here, I can show it on the screen, of course.

But you say that the gold is being kept by Perú not because of an illegal acquisition, but a guarantee that potential civil redress of the accused. Is that your opinion? Do you recall that?

A. Yes, it is based on what the lawyer for Perú indicated in the First Report, that the seizure had the purpose of guaranteeing redress. But, in the Second Report, he also said that it had to do with the

[Page 892]

seizure of proceeds of the crime.

Q. Mr. Missiego will talk about that, but at Page 7 of your Second Report, you made that statement. That statement has to do with what you say Perú is doing through its jurisdictional bodies. You're not saying that, "according to Mr. Missiego," et cetera, et cetera. That is your conclusion. That is an appreciation of fact that you make. You say that the gold is being kept by Perú not as an illegal acquisition but to ensure the potential civil liability of the accused.

A. Please show the Report on the screen.

Q. Yes, of course. It's the Second Report, your Second Report, Page 7.

A. Just one moment, please.

Q. Take the time you need, sir.

(Witness reviews document.)

A. Yes, that's correct. That's right.

Q. Perhaps this was a misunderstanding. You were responding to what Mr. Missiego was saying or you were saying that the jurisdictional bodies of Perú were keeping the gold, not in order to seize it but

[Page 893]

for purposes of determining civil liability?.

A. Yes, but let me give you the context.

The law provides that there is a seizure to determine the proceeds of the crime, and then the seizure also for redress purposes. If we're talking about the effects of the crime, we would have to identify the perpetrator; and, when the Judgment is rendered, then there could be a loss to the State--or, rather, in favor of the State. Since Kaloti Metals has not been charged of any crime, that possibility cannot take place. There is no charges against Kaloti Metals in the criminal procedures in the preliminary stages or in the investigation stages. And also, that did not happen in the criminal accusations issued.

So, the impairment that could exist for Kaloti Metals, could only happen for redress purposes because there is no criminal charges.

Q. Thank you for your explanation.

Let me try to understand what you're saying before we move on to the document. The Court would draw a distinction between the property that is being seized because they are the product from an illicit

[Page 894]

activity, in this case the illegal acquisition of the gold, and then on the other hand, there would be seized property to support a potential case of civil liability; is that correct?

A. Yes, that is correct.

Q. Would that distinction be drawn in the decision made by the Court?

A. Let me explain the grounds for this.

Article 102 of the Criminal Code, Paragraph 4--and I can look at the paragraph. I can look at the law.

Q. Yes, of course, you can.

A. Yes. It is 102 of the Criminal Code Paragraph 3. 102(3) of the Criminal Code clearly provides that, for purposes of confiscation, we need to draw a difference between lawful property and unlawful property, and sometimes there is a mix of those two, and this is not something that happens only in the legislation in Perú, but there are other provisions such as the Convention of the UN on Organized Crime, the Convention Against Corruption, et cetera.

So, the State must make a difference between

[Page 895]

illicit property and licit property. So, the State must say whether in the seizure is for purposes of redress or for purposes of confiscation.

Q. Thank you.

Let's look back at the documents in this case. You said that Mr. Missiego, in his Second Report, clarifies something. I don't remember what you said, perhaps you didn't say "clarify," perhaps you said that a new argument was posited by him, but in the Second Report by Mr. Missiego, Mr. Missiego says that the purposes of the seizure are not only related to civil redress, but they also have to do with criminal matters. Is that what you said?

A. I don't remember in detail everything in the reports of Mr. Missiego, but I remember that in his First Report he emphasizes quite a bit the issue of a seizure for redress purposes. In the Second Report, he provides an answer to a comment made by me, and he said that the seizure may also be related to a crime for purposes of a seizure.

Q. Okay. Thank you very much. We can hear Mr. Missiego this afternoon, but if we look at the

[Page 896]

First Report of Mr. Missiego at Paragraph 154--

A. Can I look at his Report, Mr. Missiego's?

Q. Yes, of course.

If you look at the first sentence as well--and I think we have that on the screen, and it says here: "In this regard, as indicated above, the seizure also fulfills the purpose of ensuring the potential confiscation that could apply to the assets that are the subject matter of the crime."

A. Yes, that's correct.

Q. So, Mr. Missiego does make reference to the purpose that the seizure has, not only the purpose related to civil redress.

Let us now look at other documents, R-224. We're going to show it on the screen. This is a case against [Redacted] and the representatives of [Redacted]:

So, the seizure of the gold bars was made in order to guarantee a civil redress. Is that your opinion, still?

A. We looked at two Orders opening the investigation. We've looked at them so far; right?

[Page 897]

Q. Yes. We've looked at them so far; right?

A. Yes. So, this makes reference to two cases in which the State of Perú is not a party. Here we have the Office of the Public Prosecutor and the accused. When you asked me about this document, I said "yes," because that's what the document says.

But if we're going to talk about this document and if I'm going to be able to provide an opinion, I would have to be certain that the origin of these documents is lawful. If you or the Tribunal can certify that the origin of these documents is lawful, then that's fine. I have read it, but for me to provide an expert opinion, I would have to be sure of that.

And there is no security breach in the computer system of the courts of Perú. The decisions are not on the internet. The information is reserved in accordance with the law, so you cannot really go into the system to see if the information is there, so I can give an appreciation, however I would need to know whether the information's origin is lawful.

Q. Sir, in your Report, you cite and make reference to this document, and you include this

[Page 898]

document in your Report, and you used it to provide conclusions.

A. Yes, because this is information that I was able to read and review. But we're here at the Hearing because the Reports come to life when an oral statement is given, so we're at a Hearing, and these considerations have to be taken into account, if we look at Peruvian law.

Q. So, you think that your comment or your clarification, warning, limitation--I don't know what to call it, but you think that that's important?

A. It is critical, because....

Q. You have explained this over and over again. We don't need to repeat ourselves. But you're saying that it's fundamental, critical. But you have made reference to these documents in your Reports, and in your Reports you say nothing about this.

A. Let me clarify. That is why we're here at a Hearing.

A moment ago--and I'm not going to repeat what I said a moment ago, but a moment ago we discussed the confidential nature of judicial cases,

[Page 899]

and we talked about that in relation to a civil case. Now, we are here dealing with a criminal case.

In a criminal case, all the files are completely confidential until the oral trial, so I was very surprised when I saw that these documents were included in the Arbitration file. I thought that the right time to explain these things was now. The law says that, to have access to copies of a criminal file, you need the authorization of a court, and the Parties need to also discuss this. I don't know if the accused have authorized the showing of these documents. I don't know if there has been a court order authorizing this.

In order for me to go line by line and provide a substantial opinion, well, that's something different. What I said is, okay, what you read is correct, that's all. But otherwise, we would need a court order saying that we have had access to this information in this way. Does that exist? Does that Order exist? Can you please help me with that?

Q. Mr. Caro Coría, you have explained this over and over. My questions are very simple. You made

[Page 900]

reference to documents in your First Report, and now, you're saying that you cannot opine on these documents because you do not know their origin. You have made reference and included those documents in your Second Report, but you're saying that you can no longer refer to them or you cannot make comments about them because you don't know the origin of those documents. Your Reports contain categorical opinions.

A. Yes, I have categorical opinions.

Q. Your opinions are very categorical on those documents. But when I asked you questions and I'm trying to understand the reasoning behind your conclusions on the basis of these documents, you're saying now that you cannot make reference to these matters, although you made reference to these things in your Reports. And you're saying, okay, you were waiting for the Hearing to make those clarifications that are critical, in your opinion.

You know that a witness or an expert witness may not be called to testify. That exists. The possibility exists.

A. What's your question?

[Page 901]

Q. I'm sure you know this because you have been involved in other ICSID Arbitrations, you have been here sitting in this room on the Claimant's side in a different arbitration. Do you know that one of the Parties has the right not to call an expert to testify. So, the Expert will not have the possibility of uttering fundamental aspects before the Tribunal? Did you know that?

A. Yes, I did know that.

Q. In your First Report, you submitted C-90. This is an Order opening the investigation in the case of [Redacted]. It is a decision of the Superior Court of Justice of Callao Criminal Court dated 30 April 2014. This is in your First Report.

A. Can you please show it on the screen?

Q. Yes, of course.

You recall that this is a document that you--appended to your First Report, it's an exhibit to your First Report.

A. Yes, that's correct.

Q. This was not submitted by Perú; it was submitted by Claimants; and it was appended to your

[Page 902]

First Report; and it is an Order opening the investigation?

A. Yes, that's correct.

Q. There are other decisions, court decisions, submitted by the Claimants and appended to your Reports--to your Report that are of a similar nature?

A. Yes, that's correct.

Q. Was Kaloti a Party to these proceedings?

A. No.

Let me explain.

When preparing my Report, when the set of documents was given to me, I asked for them to tell me whether that information was accessed in a lawful and consented way. I was told that that was the case and that is why I have made reference to those documents.

Q. What is the origin of those documents?

A. Well, the people from WDA should answer that question. They were the ones who provided the documents to me. They gave the documents to me, and I asked for a confirmation that that information was obtained using lawful means.

Q. And you were given an oral confirmation of

[Page 903]

that?

A. Yes.

Q. And, for you, that was enough.

A. Yes. Because I work under the principle of professional trust; and, when a colleague assures something to me, I trust that information, the veracity of that information. So, if they tell me, okay, this was obtained lawfully, then that's fine, we can go into the merits and look at things.

Q. You also appended C-94, another document submitted by Claimant in the context of an Order opening the investigation, a criminal investigation, of 9 September 2014; and then C-91--it's a long list. There is a series of documents that are similar to these, and you're saying, "okay, I cannot answer questions that you're--the question that you're posing to me." But you're saying that you cannot answer it about these documents but you can answer about other documents, and you're saying that the Claimants said that the origin of those documents was lawful. Is that your testimony? "Yes" or "no." Please don't repeat the explanation that you have provided to us.

[Page 904]

I think it's very clear. You have made your explanations very clear, but have I correctly summarized the situation?

A. You're asking a concept question or a factual question or an opinion question?

Q. Well, let's move on.

I'm going to show you R-224. I'm going to ask questions. If you do not want to refer to this document because you have not provided a warning in writing, but you're presenting that warning now, I'm sure you will let me know.

Let us look at Page 11 of this document 224.

This is an Order opening the investigation for [Redacted]. It is the same case in connection with which you submitted documents.

At Page 11--I'm going to show it on the screen--it says that the representative of [Redacted] has not yet proven the legal origin of the seized gold, and it is ordered that the Precautionary Seizure continue to ensure the further forfeiture of the seized gold. Then, I want us to contrast that with

[Page 905]

what is said above, which says: "Let a preventive attachment be placed on the assets owned by the prosecuted parties to cover a future civil reparation".

Do you see the difference?

A. Yes, I do.

Q. Let us look at R-145, another Order opening a criminal investigation.

A. Could you please show Page 1?

Q. This one or the other document?

A. This one.

Q. Okay. Let's show R-145, the first page. Let us look at the full--

A. Just one moment, please.

I would like to see the last page. The very last page, please, of this Order. Is that the last page? I don't see the signature of the Judge. Am I misreading this?

Q. Is this the last page?

It appears that this is the last page.

A. So, there's no signature by a Judge.

Q. Well, that's what we have on the screen.

[Page 906]

A. Please scroll up. I saw a seal somewhere. I thought I saw a seal in one of these pages. Please scroll up.

It appears that there is no court seal, and judicial orders, court orders, have to have the seal of the Judge and of the Clerk, the Court Clerk.

Q. Okay. We take due note.

Let us now go to Page 24. It says here, "in order to guarantee the payment of civil damages" and it talks on the preventive attachment "for the purpose of seizing assets that are known to be the property of the defendants", correct?

A. That is what the document says.

Q. Okay. Let's look at Page 10 and 11. And it says here "preventive seizure should be established on assets property of the defendants to cover a future civil reparation".

A. Okay, that's what the document says.

Q. So, you say that the Precautionary Measures have to be temporarily limited; right?

A. In the preliminary stage, yes.

Q. You also maintain that by applying Article 6

[Page 907]

of Law 27379, when an Order opening the criminal investigation takes place, the Judge must make a pronunciation about the continuation or the termination of the Precautionary Measures?

A. That's what the law says.

Q. And when you looked at the Orders opening the criminal investigation against the four cases against the Suppliers, the Judge made a decision in connection with the continuation of the seizures?

A. I'm making reference to the documents that were appended as exhibits. I don't see the seal of the Court or of the Court Clerk, so I don't know how truthful those documents are, but, yes, that is what the document says.

Q. However, you say that in the seizure that was ordered under the Order opening the criminal investigation, there has to be a timeline established for the duration of that seizure; correct?

A. Yes, correct.

Q. And then you say that the law is very clear and it allows us to see that the law does not allow us to have a seizure that is valid indefinitely, that is,

[Page 908]

it has indefinite duration?

A. Yes, that's right.

Q. I would like to see where this is indicated expressly and clearly. Let us look at Article 6 of this Law 27379.

MR. GRANÉ LABAT: For the record, this is JM-25.

THE WITNESS: May I please take a look at the law text?

BY MR. GRANÉ LABAT

Q. What is your version? Because there are different versions, and I just want to make sure that we're looking at the same one. Let us put it on the screen and so you can tell us whether what you're looking at is different or not.

A. Just a second.

It is same one because it was never modified.

Q. Then could you please tell me where in Article 6 you can clearly see that a Precautionary Measure may not extend during the final proceeding and up to the issuance or the handing down of a judgment?

[Page 909]

A. This law only governs the Measures that were issued in the preliminary stage. The rest is governed by the Criminal Code, Criminal Proceedings Code. Article 6 does not need to include a regulation to that end. Article 6 is not relevant after the preliminary phase.

Q. So, you're differentiating between the preliminary phase of a Precautionary Measure and then other Precautionary Measures during a different stage of the proceeding; correct?

A. Yes.

Q. Now, in connection with this stage, I make a note of what you just said. It is important the difference, as you just mentioned. Now, let us look at Article 6 as applied to the preliminary stage. Where does it provide that that Measure may not be maintained?

A. Article 6 only refers to the Criminal Proceedings Code. It doesn't govern those Measures.

Q. You also mentioned in your First Report that the subsistence of the Precautionary Measure of seizure now in the Criminal Proceeding is unreasonable

[Page 910]

since it goes beyond the time provided for under the law. But in neither report, you refer to any law that determines the period for Precautionary Measure after initiation of the proceeding. Or could you please tell me where you refer to that law in your Reports?

A. I do not refer to any law setting a period of time. But, as you may know, Precautionary Measures are provisional. It is a Precautionary Measure provisional when it lasts nine years? As I said in my initial presentation, the Constitutional Court has declared null and void all types of Precautionary Measures that have exceeded reasonable terms.

Q. Would you please mention a law in Perú that prevents a Precautionary Measure from being maintained by an Order of the Tribunal up to the end of the legal proceeding?

A. There cannot be any because Precautionary Measures are the exception, not the rule. Therefore, there should be a law that says otherwise, that expressly states: "Precautionary Measures may last up to the end of the proceeding, even at the cassation stage". We are talking about restrictions of rights

[Page 911]

and, by definition, rights are restricted by express norm. So, you do not need to have a law to indicate the contrary, but here we're talking about the general characteristics of these Precautionary Measures that it is of a provisional nature.

Q. So, there is no law in Perú preventing the maintenance or the survival of a Precautionary Measure up to the end to guarantee the seizure in case it is an illicit good or seizure for civil reparation. And if there is any, please let me know.

A. There is no law to that end, and if there was any, it would be unconstitutional.

Q. Okay. Let us look at JM-34--no, rather--I think it is--this is properly established, so now in the interest of time, let us look at the applications presented by Kaloti in the proceeding.

PRESIDENT MCRAE: You mentioned time, and so I thought maybe I should--that's an appropriate time to check where we are going here because the original schedule finished the cross-examination at 12:50. I'm not suggesting you stop, I'm just asking where we're going and what the time will be.

[Page 912]

MR. GRANÉ LABAT: Thank you very much, Mr. President.

We have on the Schedule today only Mr. Caro Coría's presentation and cross-examination; and then Mr. Missiego's presentation and cross-examination.

Our understanding, and Ms. Kettlewell will correct me if I'm wrong, is that we have available for our cross-examinations and Closing Statements roughly about almost I believe eight hours, Ms. Kettlewell, as of last night. So, what we have done is distribute our time accordingly between the cross-examination of Mr. Caro Coría and the cross-examination of the damages experts, but we are mindful that we must conclude the examination of both experts today. We are, as always, in the hands of the Tribunal as to when to take the appropriate breaks, but we are aware that we have to distribute our time accordingly within the overall time that has been available to the Parties.

PRESIDENT MCRAE: You expect to finish--I know you can't predict this, but you expect to finish by the lunch break?

[Page 913]

MR. GRANÉ LABAT: Highly doubtful, Mr. President. I hesitate because as always, it's difficult to ascertain. If the lunch break is at 1 p.m., I think that that would be difficult, but I can do my best.

PRESIDENT MCRAE: Okay. Please proceed.

MR. DÍAZ-CANDIA: With your permission, Mr. President. Just a note, we're not protesting anything that Mr. Grané just said, but if both Parties use all the time they have allocated for cross-examination of the legal experts and the Quantum Experts, we're not going to finish tomorrow. We have no problem, but we don't want to be put in a position tomorrow or this afternoon also limiting our time because their right to use their time. Just take into account that we then may not finish tomorrow. That's all.

PRESIDENT MCRAE: I think that they have a right to the time and so do you. And if that means continuing, then we'll have to continue. We can check that--we can check where we're at the end of the day, but I think that we should just proceed with both

[Page 914]

having the full opportunity to cross-examine the Experts.

MR. GRANÉ LABAT: Thank you, Mr. President. I appreciate that.

And we're also happy to confirm with our distinguished colleagues during the break to make sure that we come to a cooperative approach to the distribution of time to make sure that we do not extend the sessions beyond what is humane for the Court Reporters and the Interpreters, but we will seek a practical resolution to the distribution of time.

PRESIDENT MCRAE: Thank you.

Please proceed.

MR. GRANÉ LABAT: Thank you.

BY MR. GRANÉ LABAT:

Q. Mr. Carlos Coría, I will try to speed up to avoid prolonging this, and I thank you for your specific concrete answers without going over too long of an answer.

you referred in your first report to three pleadings presented by Kaloti before the Judiciary in the company by means of those pleadings requested the

[Page 915]

return of the seized gold. And in your Report you did not refer, you did not cite or for the record, those are Exhibits C-13, C-14, and C-15. And I will ask you questions about those exhibits. But before then, I would like to confirm that you did not cite any other pleading presented by Kaloti in the Criminal Proceedings requesting the return of the gold shipments.

A. Correct.

Q. And another point for confirmation, is that the three pleadings, the three pleadings that you attach to your Reports, were presented before the Courts in charge of the Criminal Proceedings against [Redacted] and its representatives; correct?

A. Yes.

Q. And that is the Criminal Proceeding that is under file 3306-2014.

A. I do not recall the number of the file, but I think it is correct.

Q. We will show it on the screen, and you will be able to confirm and if I'm wrong, you can correct me then.

[Page 916]

So, the three requests made by Kaloti, the three petitions before the Courts only refer to the [Redacted] shipment.

A. Correct.

Q. And you did not mention any other attempt to participate or present a petition in connection with the other four shipments.

A. As I just said, that is correct.

Q. I apologize for asking you again, there are some issues that are so important that they need to be completely clear as to what your position is and as to what the facts are, so please bear with me.

Do you know, in spite of the fact that you're not referring to them, you have not attached them to your Report, do you know of any other attempt to participate by Kaloti in connection with the other shipments?

A. As a result of the Second Report by Mr. Missiego, I saw that there is reference to two other pleadings. I do not remember it by heart, but they were not given to me for me to issue an opinion.

Q. Did you ask your client to give you all of

[Page 917]

the documents presented before the Criminal Courts in connection with these proceedings for the--on the shipment?

A. Correct.

Q. And you were only given three?

A. Correct.

Q. In your reports, you're not referring to pleadings presented by Kaloti before the Office of the Public Prosecutor or the Ministry; correct?

A. Could you please show me because I do not recall?

Q. Yes.

I am--if you're asking for the list of exhibits, you have two Reports. They're at the beginning of your Report--

A. Yes, yes.

Q. Mr. Coría--

A. You're correct, yes, that's correct. 13, 14, 15.

Q. And you also referred to this in your presentation, and let me ask you about the resources that were available to Kaloti under the Peruvian

[Page 918]

criminal system or general procedural Peruvian system.

In your Report, you said--and I think that you reiterated it today--that Kaloti was not forced to use the channels mentioned by Mr. Missiego in his Report, and they are appeal, amparo and re-examination.

A. Yes, that's right. That's a right, not an obligation.

Q. But those channels or paths were also available to Kaloti. There may be discussion about the re-examination, but, do you discuss that there are paths available under Peruvian law to appear before the various jurisdictional bodies?

A. Once again, there is no discussion, it does not exists a re-examination in the procedural law, that is discarded. I mention this because you have stated it. I understand the issue of the appeal, okay? To activate the right to appeal--

Q. I'm not asking you to explain the process.

MR. DEL VALLE-CORONA: Objection, Mr. President. The Witness may be allowed to cooperate with the Tribunal in his areas of expertise,

[Page 919]

that's what he is doing.

MR. GRANÉ LABAT: If you want the Witness to expand, to elaborate, he can do so during the redirect. I only asked him whether there are pathways or general channels that could have been used by Kaloti under Peruvian criminal law or procedural law in Perú.

THE WITNESS: Are you asking me about the appeal phase?

BY MR. GRANÉ LABAT:

Q. In general. Any resources, any remedies that Kaloti had.

A. According to the law, there are several mechanisms.

Q. Now, let us look at what Kaloti presented, and this can be done in a positive or negative fashion. Let us start in a negative fashion. You would recognize that Kaloti did not file an amparo against the Seizure Orders of the Court?

A. Would you please repeat?

Q. Certainly. You recognize that Kaloti did not file an amparo, a constitutional amparo, against

[Page 920]

the Seizure Measures ordered by any of the Peruvian courts in connection with the shipments?

A. I'm not aware of any amparo proceeding.

Q. And did Kaloti appeal any of the Seizure Measures?

A. I do not know of any appeal proceeding.

Q. And you said that they did not--or rather, no, you do not say that. You acknowledge that Kaloti did not present a request for re-examination.

Did Kaloti present a re-examination against this judicial decisions?

A. No, they did not because it was not part of the procedural phases available.

Q. Now, let us look at C-0013, 14, and 15. Let us look at 13. You will see--and you can confirm if I was wrong at the outset when I said that these pleadings were part of the file 3306 of 2014.

A. What is your question?

Q. I will get there. I just want to offer you some context. As part of this pleading that you read and attached, this is about [Redacted], and it is the only case in which Kaloti appeared to request the

[Page 921]

devolution, the return of attachment--of Shipment No. 3 saying that they were the owners.

A. Correct.

Q. And this is not a long document. I would like to ask you where you see a reference, or is there a reference in this pleading to any exhibit--

A. Would you please scroll down?

Q. Certainly.

A. Would you please go to the end?

At least I do not see any exhibit list.

Q. And, in this text, do you see any reference to an exhibit or file number?

A. Please let's move on to the beginning of the document.

No, I do not see any reference to an exhibit.

Q. Let us look at the second pleading, C-14. This is Spanish. And in English that would be R-228.

Once again, the same file, 3306 of 2014, [Redacted]. And here Kaloti's requesting to set aside the Seizure Order on Shipment No. 3, and here there is a reference to an exhibit, on the last page.

[Page 922]

A. Yes.

Q. And that reference there is the Notice to file a case to arbitration against the Republic of Perú presented by Kaloti on May 3rd, 2016. This is a Notice of Intent.

And then the seizure are supported by Kaloti is that this is breaching the Investment protection to foreign investments under the Free Trade Agreement, and that's why it is attaching this Notice of Intent; correct?

A. That's what the text said.

Q. Also in connection with this, do you see any other reference to any other document that Kaloti has provided?

A. No.

Q. Do you see any other reference to an exhibit?

A. No.

Q. This pleading is dated May 25th, 2016. Correct?

A. Let me look at the stamp.

Q. The stamp is difficult to read. It may look

[Page 923]

like June 7th, but the date of the pleading is May 25th, 2016; correct?

A. Yes. That is the date of the document.

Q. And if I am correct, this is not even two years up to April 30, 2018; correct?

A. Yes.

Q. Let us look at Page 2. And, here--rather, here Kaloti is saying that they acquired this shipment in good faith and by means of bank payment.

Do you see it?

A. That they acquired this in good faith? Yes.

Q. But you would know that Kaloti never paid for this shipment, Shipment No. 3 of [Redacted].

A. That's what I saw as part of this proceeding.

Q. In the interest of time, I'm not going to take you to the documents confirming that, but for the record, Exhibit C-22--that is the Notice of Intent of April 8, 2019, Paragraph 33, and then the Reply by the Claimant, Paragraph 35, where Kaloti states that they were unable to pay for Shipment 3 and 5.

Let us now look at the third pleading

[Page 924]

presented by Kaloti, which is quite similar to the one that we just saw, and I am going to ask you to put on the screen C-15. And, in English, that would be R-229.

And here, once again, Kaloti is requesting the return of Shipment No. 3. Part of the same file 3306.

Let us look at the last page. This pleading is also referring to an exhibit. It is the same exhibit. The Notice of Intent on May 3rd, 2016, and I have the same question: Do you see any reference to any other document?

A. No.

Q. Do you see any other reference to any exhibit or any other document on the shipment?

A. No.

Q. A question again--and we're trying to speed up. If you would like, we can show you the documents, but I am not trying to rush you.

Did you review these pleadings? we saw that in two of them the only exhibit was the Notice of Intent. Did you review the Notice of Intent?

[Page 925]

A. No, I did not. Just the pleadings.

Q. But you did read the pleading whereby Kaloti sums up for the jurisdictional body their arguments?

A. Yes, clearly, what you're showing on the screen.

Q. And you would recall that, according to Kaloti, in 2016, they stated--Kaloti stated that they are claiming for a violation of Article 5 under the Perú-U.S. BIT, and you would know that Article 5 is the provision that establishes the minimum standard of treatment under international customary law?

A. I do not know, but I do know that that rule exists.

Q. Let us look at the response by the judiciary, and I am going to ask you very specific questions, and you have already referred to this in your Report. Exhibit C-100 is a response to Kaloti's intervention, as we have seen and as part of that decision, the Criminal Court responded to Kaloti's pleading, and they rejected that request because they felt that Kaloti had not proven that they were the owners of the seized gold ingots, and this is at

[Page 926]

Page 3. You also referred to this--this is at Page 3 of C-100. You already referred to this also in your Report, and my question is whether you know whether the other Party has informed you whether Kaloti presented, filed any application in connection with C-100.

A. I have not been informed of that.

Q. Do you know, based on the information that you received and also considering the documents on file, do you know whether Kaloti presented again a pleading before the Peruvian court within the context of this file, Shipment 3, [Redacted], in which they stated that they were the owners of the gold, and this is the evidence of that, do you know if there is something like that, that presentation before the courts?

A. I only saw the three documents that I mentioned.

And based on my experience, let me clarify something.

Q. Certainly.

A. This Resolution, that is hereby mentioned,

[Page 927]

is--does not include-any motivation.

(Overlapping speakers.)

Q. I asked you a very specific question about what Kaloti did. I am not asking you about reasoning. You have already expressed your opinion at Page 16. The Tribunal has read that. If you would like to expand or elaborate, you can do that in due course, but I only asked you about what Kaloti did after filing this, and let us--

A. I want to clarify something in connection with the last question because you're asking whether I knew that Kaloti had appealed this. My answer is that I do not have information, but it was not something that they could appeal because you can only appeal reasoned decisions, and this has received the treatment of just a decree.

So, they're going to say you're not party to this, and that's the end of it.

Q. The amparo remedy protects fundamental rights; correct?

A. Yes.

Q. And it can be filed at the request "of any

[Page 928]

public body"; correct?

A. This is subject to many conditions that need to be analyzed.

Q. But the amparo is the remedy to question, to challenge Measures by any State organ.

A. As a general rule, yes. But then it requires specific study.

Q. And then it also requires fundamental rights; correct?

A. Yes.

MR. GRANÉ LABAT: If things move along at this pace, I think we will be able to conclude before the lunch break, but as always, Mr. President, I'm in your hands as to whether you think it's appropriate to take a short break, but we are happy to continue.

PRESIDENT MCRAE: The Schedule originally contemplated that we would break for lunch at 12:40, and the timing was predicated on that basis. If we continue until 1:00, that means adding an extra half hour on to that time. So, I have no--it's really a matter for the Court Reporters. If we take a short break now will you continue until 1:00?

[Page 929]

REALTIME STENOGRAPHER: Yes.

PRESIDENT MCRAE: Let's do that. As short break and then continue to 1:00 and then take the lunch break at 1:00.

(Brief recess.)

PRESIDENT MCRAE: I think when you're ready, we can resume.

MR. GRANÉ LABAT: Thank you very much, Mr. President.

During the break, having consulted with the team and in the interest of hopefully releasing Mr. Caro Coría before the lunch break, we have decided to conclude our cross-examination at this stage.

PRESIDENT MCRAE: Thank you very much.

That means we now move to the re-examination by--direct examination by the Claimant.

So, you're still under the Declaration you made earlier, and we will now ask the Claimants to ask any questions they have of you.

MR. DEL VALLE-CORONA: Thank you, Mr. President. I will proceed in Spanish now.

REDIRECT EXAMINATION

[Page 930]

BY MR. DEL VALLE-CORONA:

Q. Dr. Caro, your written reports for this case are confidential. Did you know that?

A. Yes, that's correct.

Q. However, the Transcript of this Hearing will be public. Did you know that?

A. Yes, that's correct.

Q. Thank you.

Going on to another topic. During your professional career--30 years if I remember correctly--have you issued opinions or reports that favor the Peruvian State?

A. Many.

Q. Can you elaborate on that.

A. I have issued different reports for public entities of Perú and some of them for free, many in terms of legislative matters. I was part of the Commission that reviewed the Criminal Code for the 2004 project, and for the one that reviewed the Criminal Procedure Code in 2004 as well, reviewing the laws in effect in terms of mining, one against organized crime.

[Page 931]

And I have also participated in the defense of multiple public entities regarding matters that I specialize in, economic criminal law of businesses. I have defended Ministers, Vice Ministers, Directors, et cetera, and the entities themselves.

Q. since we're talking about laws, can you explain whether the requirements of Decree 1107 were affected or were they made more lax during the process of formalizing to the small miners and artisanal miners in Perú?

PRESIDENT MCRAE: I'm afraid the translation was going on, so I'm way behind in the discussion between you two, so I understand there is an objection to the question.

Do you have a response to that?

MR. DEL VALLE-CORONA: It's strictly related to the 1107 Decree, which was exhibit--

PRESIDENT MCRAE: Can you repeat the question to me, so that I--

MR. DEL VALLE-CORONA: Yeah, sure.

BY MR. DEL VALLE-CORONA:

Q. Can you explain whether the requirements of

[Page 932]

Decree 1107 that was shown to you by the Peruvian counsel were effected or were they made more lax during the period of formalizing small miners or artisanal miners in Perú?

MR. GRANÉ LABAT: And my objection, Mr. President, is while we speak about 1107, that does not open the doors to ask any question under the umbrella of 1107. We had no discussion about artisanal miners. I never uttered those words throughout my cross-examination.

So, if citing a Decree or law then allows the other Party to then initiate a new line of questioning, then the scope of redirect is so broad that it's an entirely new presentation.

PRESIDENT MCRAE: So, what was the link that you were planning to make?

MR. DEL VALLE-CORONA: With your permission, Mr. President, Mr. Grané referred to the requisites that were mentioned in 1107 Decree.

PRESIDENT MCRAE: But your question was about--

(Overlapping speakers.)

[Page 933]

MR. DEL VALLE-CORONA: And my question is related to the application of those requisites.

PRESIDENT MCRAE: Let's continue with that question and see whether it actually gets back to what we were discussing. If it does, we can pursue that, but otherwise, that might be a short and brief response.

MR. DEL VALLE-CORONA: Thank you.

PRESIDENT MCRAE: I think you might have to pose the question again before you ask him to answer.

BY MR. DEL VALLE-CORONA:

Q. Dr. Caro, can you explain whether the requirements of Decree 1107 which were shown to you by Perú's representatives were impacted or made more lax during the process of formalizing small and artisanal miners in Perú?

A. Just to clarify, you're talking about Article 11 which was shown to me?

Q. Yes.

A. The answer is "yes."

And here, we need to clarify something that's important. There is a difference between

[Page 934]

artisanal mining, informal mining and illegal mining. Most illegal and informal miners are artisanal. So, we're talking about the same thing, there are miners who, let's put it this way, do their work on a small scale, so the process of formalizing them, to be very brief, involves their registration. In the Registry of informal miners that are in the process of formalizing their business, and that process has not come to an end. That's why the requirements of Article 11 have been made more flexible.

Thank you.

PRESIDENT MCRAE: I think we've heard enough about that subject. Move on to something else.

MR. DEL VALLE-CORONA: We will move on.

PRESIDENT MCRAE: Thank you.

BY MR. DEL VALLE-CORONA:

Q. Additionally, Mr. Caro, someone mentioned to you the file review system for Peruvian cases. Does this consultation system contain the entirety of the decisions or just when they were issued?

A. Well, in terms of these criminal files, it doesn't contain any of that. The only way to have

[Page 935]

access to that is through a decision, Court Decision. If we're talking about Civil Proceedings, as I said, it's not for me to explain why, but there is a digital gap. Some people have access to some decisions in the system, and that can be a part of the process.

Q. Thank you very much.

Also during your examination, you saw Exhibit R-145, and they talked about fingerprints. In terms of the Order initiating Criminal Proceedings, is this something that is usually done for private due diligence? Comparing fingerprints?

A. Well, as I said, I can't refer to the details of these criminal documents, but I can make general comments.

In general terms, the Compliance in Perú it's not police. Officer does not have police functions. They use the information that they have available to them. This does not include access to databases or fingerprints. Only the State can have access to that due to privacy of personal data. They also don't have access to data on ongoing Criminal Proceedings because there is a lot of false positives.

[Page 936]

I won't elaborate on this because I have written about this, I have given conferences about this.

Q. Thank you.

Going on to the next question, with the information in the file and the record and that you have been shown today, in your experience, what likelihood is there that Kaloti would be found liable regarding their due diligence?

A. At this time, there is no likelihood of that because none of the employees have been formally charged nor has the existence of bad faith been established, so the probability or the likelihood of a said negative sentence is zero.

Q. In the interest of time and to conclude, before you finished your examination, counsel for Perú did not allow you to finish at 12:15 when you were talking about the appeals or the amparo recourse for Kaloti. Can you finish, if it's still fresh in your mind?

A. Yes, because it was part of my initial presentation.

All of this is made possible if there is one

[Page 937]

rule that is being followed by the judicial system, and this is in Article 4(5) of the law 23739, which says that the Judge must notify affected Parties regarding that preliminary Order. And from what I have seen up until now during this examination, I have not seen a single document from the judicial authorities addressed to Kaloti where they were told "we are impacting your rights for these reasons."

That is what activates that due process and that right to defense.

So, from my perspective, there is a failure in the procedure here that has its origin in the preliminary phase with those Precautionary Measures of Law 23739, and that's what voids the entire process because it is a violation of the right to defense of the affected Party; and this is not just for the Measures, it's regarding evidence and documents, so that the right to defense can be activated.

Q. Thank you very much.

Two questions, two additional questions. In Perú, amparo, is it a way to obtain civil reparations?

A. No. It's just to bring things back to their

[Page 938]

previous phase. It is not a reparation. There is no obligation to go to amparo.

When you file an amparo, and that's why when I gave my answer, I said there was a special exam because--a special test. First, you have to exhaust all other recourses; otherwise, it can be inadmissible because there is a proceeding in course, and that's when the decisions have to be made about the metals and the merits.

Q. Amparo is limited to the application of the Peruvian Constitution; correct?

A. The Constitution of Perú and the constitutional Procedural Code.

Q. Thank you. That's all.

PRESIDENT MCRAE: Do you have further redirect?

Please, go ahead.

MR. GRANÉ LABAT: Yes, Mr. President. We are going to do recross. Can we please--I'm going to switch to Spanish.

RECROSS-EXAMINATION

BY MR. GRANÉ LABAT:

[Page 939]

Q. You were asked about Legislative Decree 1107 and artisanal or informal miners were mentioned, even though I had not mentioned it, but since the opposing side mentioned it, then we can talk about it.

Let's start with what the Claimant alleges in this case.

Did you have a chance to read also the statements of the Claimant's witnesses?

A. Which statements are you talking about?

Q. I'm asking you the general question first, and then I can be more specific.

So, I'll repeat the question. Have you read the testimony of the Claimant's witnesses? "Yes" or "no."

A. No.

Q. Okay. Then, let's look at the statement of Mr. [Redacted]. Let's look at Paragraph 9, the last page. I'm sorry, the Second Witness Statement, Paragraph 10. That was my mistake.

Good. There you see that Mr. [Redacted], the principal on the Claimant's side, says that the Suppliers, in this case, are not artisanal but are

[Page 940]

considered to be medium-sized. In spite of that, we will see which procedure applies for informal miners.

In case--which they aren't--but in the event they were informal miners, let's look at C-0044 on the screen, just the first page for now because I want to ask, Mr. Caro Coría, are you an expert on the process of regularization of informal or artisanal mining, miners who want to regularize their situation?

A. I'm not an expert. But, in the exercise of my career, I have dealt with a lot of mining companies that have been affected by informal mining, so I'm familiar with the legislation, but that does not make me an expert.

Q. But you know the procedure that applies for informal miners, first of all?

It's two question, so I will divide it into two.

Are you familiar with the regularization process for informal miners under Peruvian legislation?

A. Yes. In general terms, not as an expert.

Q. That's the first question.

[Page 941]

The second question is whether you are an expert in or are familiar with the obligations that apply for these artisanal miners who wish to regularize their status. Do you know the requirements? in general terms?

A. In general terms, yes.

Q. Okay, then I can show you Page 36 of this document.

I want to ask you a few questions. Can we look at the first page, just to show for the record what we are talking about. This is the national plan for the formalization of artisanal mining in Perú from the Multisectoral Technical Commission. And this is from 2011 as you can see on the cover.

Let's go to Page 36 now. This is an image that shows the stages, the steps that are necessary for the formalization process, and you'll see here--let's go step-by-step.

You'll see here first, that you have to file a Declaration of Commitment.

Do you see that?

A. Yes.

[Page 942]

Q. Do you know in this case or have you seen, have you reviewed any document in the records for this case regarding those Suppliers of the Five Shipments that shows that there was a filing of a Declaration of Commitment?

A. Only what was shown to me during the examination.

Q. It's not an exhibit that you refer to in your Reports?

A. Not as far as I remember, no.

Q. Which is the shipment that you say, when you showed a document during examination?

A. There was one entitled "Declaration of Commitments" where you said that the name did not correspond to the Concession.

Q. Correct, yes.

Which was the Supplier? Can we confirm which shipments that document that you're referring to is for?

We're going to show it on the screen in order to confirm which shipment it refers to. And while they're looking for that, I can ask a question.

[Page 943]

Have you seen another document that refers to a Declaration of Commitments for any of the other shipments?

A. I don't remember right now.

Q. I want us to look at that document again on the screen, and then we will go back to this illustration because I want to focus--there we go. Thank you.

So, this refers to [Redacted]. Let's go back, then, to the relevant page where there is a reference to this commitment. It's C-132, Page 17.

And you'll recall we had gone through this, who the person filing this--is Mr. Manuel Valdiviezo Guevara. And I asked you, what connection does he have with [Redacted], do you recall that?

A. You asked me whether this document, the Declaration of Commitment, had something to do with the taxpayer number of [Redacted].

Q. No, sir. I have this written down. I asked you whether Mr. Manuel Valdiviezo Guevara is a representative of [Redacted], and you said "no."

That wasn't what you were seeing on the document. You

[Page 944]

want to look at your response?

A. Just to clarify, this commitment Declaration is for a natural person, so there is no relationship to a legal entity.

Q. That was my question. That was your answer, and you're confirming it. I thank you for confirming it.

So, having established that, regarding [Redacted], I repeat my previous question--and let's go back, please, to the illustration. There is no other document that you have seen in the record for this Arbitration that refers to any other shipment where that information is present; correct?

A. Correct.

Q. Have you seen any information in this Arbitration or have you mentioned in your two reports any document that show ownership or an operation contract or a mining concession, for any of the Suppliers for the Five Shipments, the four Suppliers?

A. No, I have not seen that.

Q. Now, the same question regarding ownership, use of the land surface.

[Page 945]

A. No.

Q. Just for the record, you're going to say--again, for the four Suppliers, have you seen anything showing ownership authorization to use the land; correct?

A. Correct.

Q. The same question regarding the other requirement for formalizing the status of artisanal miners, have you seen anything about an approved environmental certification for any of the four Suppliers?

A. No, I have not seen that.

Q. In the interest of time, I won't continue, but there is another step, approval of the instrument and authorization for the initiation or re-initiation of exploration, exploitation and/or profit from the minerals, and there are no documents regarding these two requirements for the four Kaloti Suppliers of the Five Shipments; correct?

A. Correct, but with a clarification.

This document from the State is from 2013, and it refers to a formalization term up until April

[Page 946]

of 2014, so it's not a current document those Terms have been extended. So, we would need to compare it to the legislation that is in force today.

Q. That's fine, but this is not in the record?

A. Correct.

Q. Very well.

THE INTERPRETER: That I do not know. The Interpreter apologizes. "That I do not know."

MR. GRANÉ LABAT: Thank you, Mr. President.

No further questions on redirect.

PRESIDENT MCRAE: Thank you.

MR. GRANÉ LABAT: Recross. Sorry.

PRESIDENT MCRAE: Sorry, I led you astray when you invited you to speak.

We now would ask the Tribunal Members if they have any questions for you, so let me--do you have questions?

We do have questions for you.

So, I think you want to go first?

QUESTIONS FROM THE TRIBUNAL

ARBITRATOR FERNÁNDEZ: Good morning. How are you?

[Page 947]

THE WITNESS: Good morning. How are you?

ARBITRATOR FERNÁNDEZ: I wanted to ask you a few questions that are general in nature in connection with your statement, your written statement, you legal opinion, to clarify some doubts that I have.

I come from Spanish law, and Precautionary Measures have been developed quite a bit, but there are some differences, substantial differences with the Peruvian system, so I wanted to have firm criteria to guide me on this matter.

First, in connection with the different remedies, in connection with precautionary resolutions--or, rather, precautionary resolutions/remedy, do they refer exclusively to the main proceedings? Is there in Peruvian legislation a specific system of remedies for Precautionary Measures, or are they included in the General Law?

THE WITNESS: Thank you very much.

Everything is included in the General Law. We don't have specialized courts. The same courts deal with the remedies.

ARBITRATOR FERNÁNDEZ: My second question

[Page 948]

has to do with the responsibility of the public administration. You have indicated that there are some cases when the State of Perú has seized property.

So, following this thesis of the general procedure, in your experience have there been rulings in connection with the liability of the administration when the administration uses these Measures inappropriately, and does that happen frequently?

THE WITNESS: In Peru, we have a law in connection with arbitrary arrests and judicial errors, but it's not used very much because of lack of budget.

ARBITRATOR FERNÁNDEZ: In connection with the Claims, have there been substantial penalties? Is there case law in that regard?

THE WITNESS: I do not remember any case in which the State has been held liable in this regard.

ARBITRATOR FERNÁNDEZ: Let us now look at the amparo. You know amparo is different in each country. You have said that Kaloti could or could not resort to an appeal when a decision is not reasoned.

You said that reasoned decisions cannot be appealed. Is that something common?

[Page 949]

THE WITNESS: In Perú, according to the regulation and practice, we have Decrees that are simple, that are just procedural in nature and then we have the orders and the merits judgments. In this case, the Court should have issued an Order, and that means that the Order should have been reasoned in connection with the intervention or lack of intervention of Kaloti. But here, they said that since Kaloti was not a party, then it could not intervene, and that is just a procedural ruling.

According to Article 4(5) of Law 27329, the Court had the duty to provide Notice to Kaloti Metals of the impairment of Kaloti Metals's rights because of the Preliminary Measures. That has not happened as far as I could see in this Hearing. This has violated the law. And in accordance with the legal system in Perú, the right of defense starts when you argue the Notice of the requirement, and that has not happened.

ARBITRATOR FERNÁNDEZ: Now, the amparo remedies that are submitted, are they all studied or some of the amparo petitions are systematically rejected?

[Page 950]

THE WITNESS: They're systematically rejected for a simple reason: The procedural Constitutional Law that was in force at the time--not the one that is current now--indicated that when there is a judicial case that is pending, then the amparo should be rejected.

So, once there is res judicata in a case, you can bring an Amparo. No amparo would have been admitted here because there were other cases pending. No amparo court is going to want to rule in connection with such important matters when there was another case that was still pending and that was criminal in nature because of alleged crimes.

ARBITRATOR FERNÁNDEZ: Thank you very much for your answers.

THE WITNESS: You're welcome.

PRESIDENT MCRAE: Thank you.

Go ahead.

ARBITRATOR KNIEPER: Thank you very much. One question.

I would like to put you to your Second Report in Paragraph 2.5. There, you quote an article,

[Page 951]

Article 948 of the Peruvian Civil Code.

Perhaps can you bring it up to the screen?

And I'm aware of the fact that you're not an expert in civil law, but since you quote this Article and you interpreted it, I dare to ask this question since I want to know exactly what the interpretation of this Article 948 is. We have in German law a very similar norm, of course I only have the English translation, this is a caveat. I want to know whether I understand this correctly.

You say in 2.7 that Article 948 is not applicable here because KML acted in good faith and did not commit any crime.

Now, my understanding of Article 948--and that may be biased by my conception and knowledge of the German law--is that the good faith or bad faith or criminal action of the Buyer is completely irrelevant. What is relevant is that an object has been either lost or subject and object had been subject to a criminal act, and this sticks to the object.

So, a lost or an object which is acquired by a criminal act can never be acquired in good faith.

[Page 952]

It is not the question whether the Buyer is in good faith, or good faith a criminal or whatever. It is the object which has been subject of a criminal act, and that's why it is outside the possibility of a good-faith acquisition.

This is my understanding, and I repeat, of an English translation of Article 948 of the Peruvian Civil Code, and perhaps inspired by my prejudice borne from my education as a German lawyer.

If my interpretation is correct and you would confirm it, then I believe that your statement in Article--in your Paragraph 2.7 would not be correct. Can you elaborate on that? Have you understood my question and my worries?

THE WITNESS: I understood it very well. Thank you very much.

Article 948 of the Civil Code of Perú is based on German law, but also on Roman law, the Code of Justin, the Justinian Code; right? So, whomever committed a crime or is not the Owner, well, then it's not--and committed a crime, then what you said is correct. If you acquire a piece of property from the

[Page 953]

thief, from the offender, well, that acquisition is wrong but it entails a number of things. When this law was approved in Perú in 1984, the 1984 Civil Code was in force. But at that time there was no law on AML, and 1106, the Legislative Decree, was not in existence, and 27765 also is the background as a 2002 Law.

So, 948, after 1984, 948 has to be read in concordance with the Law on Asset Forfeiture and the law on AML.

How can we read this when we compare the different provisions? Okay. 948 affords a protection to the good-faith purchaser. The Law on Asset Forfeiture is very specific in this regard. The bona fide Acquirer has to have qualified good faith, has to have a special type of good faith. In this context, the State, whether via a forfeiture case or a criminal case, what the State has to do is to attribute bad faith to the Buyer. There is no accusation by the State to Kaloti Metals saying that it was done in good faith, saying, "okay, the Seller committed a crime," but 948 of the Civil Code, it's not a self-applied

[Page 954]

provision. It can only be applied when there is a judgment that says, "okay, the Sellers are the ones who committed the crime."

There are three accusations. There is a trial now. And there is another case that is at the intermediate stages, procedurally speaking.

Thank you.

THE INTERPRETER: Please speak closer to the mic, sir.

ARBITRATOR KNIEPER: I have to specify my question again. Let's go to the text. And perhaps, when you go to the Spanish text, it is different from the English text. When I read the text, I read in Paragraph 1 in Sentence 1 of Paragraph 948, I read what you say. It is a protection of a good-faith Acquirer. That is Sentence 1.

And Sentence 2 makes, like in German law, like in the Code of Justinian, there are two exceptions. The first exception is good faith by the Buyer is not protected. If either the object had been lost or it had been somehow a subject of a criminal act. Once an object is subject to a criminal act, it

[Page 955]

is not any more covered by Article 948.

This is Roman law, by the way, which the Germans and the Peruvians simply copied.

So, even in a long row of Acquirers, I'm the thief, I sell it to a good faith Acquirer, Mr. McRae. Good faith Acquirer. He will not be protected and he will not be the Owner, and he sells it on to Mr. Fernández. And again, he will not be protected because the fact of being lost or stolen, for instance, or by other means of criminality, sticks to the object, so it cannot be acquired in good faith.

We had this very importantly in the enforced sales of Jewish property during Fascism. There have been many odd objects which have been where Jewish people had to be forced, more or less, to sell things in the 1930s, and they very often came to the United States and other countries, and they changed owners seven, eight, nine times, and it ended up, for instance, in the Museum of Modern Art in New York. The Museum of Modern Art in New York being a good-faith Acquirer, and all these others, except the first, were in good faith, could not wipe the criminal

[Page 956]

activity of the first act out.

So, the Museum of Modern Art will not become an Acquirer or Owner, although it is perfectly in good faith.

So, in my understanding, Article 948--and I ask you to confirm or to say no, it's different in Perú--Kaloti could be a perfectly good faith. It doesn't matter whether Kaloti is in good faith or not because the gold is--I don't say that, I don't want to refer, forget--it could not acquire in good faith property of the gold, if the gold--and I don't want to qualify that--if the gold, the first miner or supplier had acquired the gold through a criminal act, would you say you have the same interpretation in Perú or are we different?

Did you understand that question?

THE WITNESS: I understood the question perfectly well.

My initial response is "yes," but there are some nuances that I wanted you to consider.

In effect, 948 tarnishes the subsequent acquisition, and this is a discussion that civil

[Page 957]

lawyers and criminal lawyer have.

What is--what information do you need to decide if it was good faith or bad faith? You have to look at the ex ante and the ex post. The ex ante during the purchase and the ex post today. We know of all of these proceedings and all these cases, so to decide whether there is good faith or bad faith, you have to take into account these two moments in time.

This is a provision that is preventive in nature. I will not protect you if you have good faith. I presume bad faith if this comes from a crime. So, you need to be diligent, diligent when you acquire the object, to try to avoid that situation.

So, 948 does not protect the stealer of a piece of property, so then the purchaser has to conduct a due diligence and see whether that was acquired unlawfully.

So, we cannot really look at what happened in 2013 and 2014 with all the information we have now. That would be an ex post perspective, and this would have no relevance from a preventative viewpoint.

I have to go back and decide on things based

[Page 958]

on the information that you had at the time of the acquisitions in 2012 or 2013 or 2014.

You have been very clear. What would happen if this, in fact, is the fruit of a crime? Well, then, you apply 948. You cannot afford protection to the Acquirer, and there would be bad faith. But, here, in Germany, we would need a judgment that says, "okay, this was born of a crime, so we need to wait for the Judgment to be handed down." If there was a judgment that said, "okay, this was born of a crime, it is res judicata, it is clear that this is the fruit of a crime, and there is a conviction, then we could afford--we could apply 948 and say there is no protection." There is a legal presumption that bad faith is established luris et de iure without any need for proof to the contrary.

ARBITRATOR KNIEPER: Sorry for that, but I believe it is not a question of substantive law or procedural law, whether there is a court judgment or not court judgment. It doesn't matter. How I read Article 948 is it doesn't matter whether the Acquirer is of good faith or bad faith. It doesn't matter

[Page 959]

whether it has conducted due diligence or not. It doesn't matter because whatever the Acquirer does, he can never become Owner of this object if the object was subject to a criminal act when it was first acquired.

So, the protection of the good faith Acquirer which is clearly foreseen in the first sentence of Paragraph 948, is wiped out in Sentence 2, and it is not relevant whether the Acquirer, the final Acquirer in this case, KML, has been in good faith, bad faith, conducted due diligence or not. He cannot--it cannot become a legal Owner. That is how I read 948 of the Peruvian Civil Code--admittedly, perhaps prejudiced by my interpretation of German law.

And would you agree with that?

THE WITNESS: I would agree, but you are setting different situations, and we have to draw a difference here.

I agree with you when you mentioned that, for 948, when the property is the fruit of a crime, it doesn't matter whether there is good faith or bad faith. We agree on that. That's why I was saying

[Page 960]

that when an object is the fruit of a crime, then, of course, there is no protection. When I was talking about due diligence, I was talking about something else.

The legal non-protection means that the Acquirer needs to conduct due diligence to protect itself from a potential object that is the fruit of a crime. 948 applies when there is a crime, there is no protection, but the exception applies.

So, you need to have a court decision to know whether a crime was committed or not. It's not something that you can presume. You need a conviction, a criminal conviction, against someone, in this case the Seller, for us to be able to know that the exception will apply. That's what I was referring to.

ARBITRATOR KNIEPER: Thank you.

THE WITNESS: Thank you.

PRESIDENT MCRAE: Dr. Fernández would like to join in the discussion. We are in the middle of a seminar that we started earlier.

ARBITRATOR FERNÁNDEZ: It's not in

[Page 961]

connection with this matter that I wanted to ask about, but I will, of course, participate in this seminar because of the brilliant comments made by Mr. Knieper.

So, a general question was asked yesterday, and I have something that I wanted to know about this.

This morning, we have talked about the scope of Provisional Measures, and we talked about a Precautionary Measure, it is translated into French as well, and so this is temporary in nature. These Measures are temporary in nature on the basis of a series of circumstances that have been established here, such as fumus bomos iuris, the periculum in mora, fumus comissi delicti, et cetera.

But, you said, that in the normal course of a Precautionary Measure, we would have the Measure in force for 90 days and exceptionally you talked about a year, so we have waited for an answer for nine years, and you wondered why. So, why is it that nine years have gone by and we would then ask ourselves what is the nature of a Precautionary Measure?

THE WITNESS: Yes, of course. We're talking

[Page 962]

about the Spanish system. In the Spanish system, you have a period of investigation. In the old Criminal Code, we also had an investigation stage. In the case of Spain, the evidence of the public prosecutor conducts an investigation and could go to the investigative judge and ask for Precautionary Measures. According to 27379, the Precautionary Measures are going to be in force for 180 days at the most.

The Measures were applied in this case, but the Rule of Article 4(5) were not abided by. Kaloti was not given Notice on the application of these Measures.

These Measures expired after Day 180. All of the Orders opening the investigation happened many months later, almost a year later.

So, what happened when the expired Precautionary Measure took place at Day 180, at 180 the expiration took place. Well, what happened there? What happened between Day 180 and the opening of the investigation? Well, there was a legal vacuum. There was a legal gap. There was no Notice given to Kaloti,

[Page 963]

and the Measure, although it had expired, the seizure had expired, then the gold was kept in the vaults of the Banco de la Nación.

So, why the delay? That is the responsibility of the State. The State is the one that has to conduct these proceedings during a reasonable period of time. And in the case of Buresti (phonetic), he's a lawyer that litigated the most complex case in AML in Perú, the Sánchez case, and it obtained a judgment from the Constitutional Court in 2009 or 2010, in connection with the termination of the criminal case against him because of a violation of the reasonable period of time.

And then there was the Chacon Case. It was a very complex case as well. It took eight years.

So, it doesn't matter that the State wants to normalize things. There has to be a reasonable period of time for the Measures to be in force.

PRESIDENT MCRAE: Thank you very much.

Yes, Dr. Caro?

THE WITNESS: Yes, I just wanted to say something that is perhaps collateral in nature. At

[Page 964]

the beginning of my cross-examination, reference was made to the social media. I'm very thankful to everyone that is interested in my social media. My last name is Caro. Caro in Spanish means "expensive," so that's what my friends call me. And that is why that is the name of that social media account.

PRESIDENT MCRAE: Thank you very much. That brings to a close the testimony. You're now relieved. Now, you can leave.

(Witness steps down.)

PRESIDENT MCRAE: And that brings us to the lunch break, which we're now close to 1:30, so I guess we'll have a break until 2:30 and resume with the cross-examination of the next witness.

So, until 2:30.

(Whereupon, at 1:27 p.m., the Hearing was adjourned until 2:30 p.m., the same day.)

AFTERNOON SESSION

PRESIDENT MCRAE: I think we're ready to start.

Are there any matters that counsel wish to raise before we start this afternoon session?

[Page 965]

MR. DÍAZ-CANDIA: Not on our side, thank you.

MR. GRANÉ LABAT: There is one issue, Mr. President, and we can raise it now, we can raise it during a break or at the end of the day. It concerns a new document that we would like to introduce which is something that came up at the start of Mr. Caro Coría's cross-examination pertaining to his participation as counsel in an ongoing arbitration administered by ICSID against the Republic of Perú.

Mr. Caro Coría suggested or even declared that he is not acting as counsel in that proceeding and that the List of Participants from that proceeding, so we're happy to discuss it now or defer the discussion until later, but we would like to submit that into evidence to show that he is counsel for Claimant.

PRESIDENT MCRAE: If there is no reason to have it dealt with now, I suppose my initial preference would be to move ahead and deal with it later, at the end of the day.

Mr. Díaz-Candia, do you have a different

[Page 966]

view?

MR. DÍAZ-CANDIA: I would prefer to leave it for later, if that's okay with the Tribunal.

PRESIDENT MCRAE: Thank you.

JOAQUÍN MANUEL MISSIEGO DEL SOLER,

RESPONDENT'S WITNESS, CALLED

PRESIDENT MCRAE: We are ready to start with the testimony of Expert Professor Missiego.

Good afternoon, Professor Missiego.

THE WITNESS: Good afternoon.

THE INTERPRETER: We could only hear him now. We couldn't hear him before.

PRESIDENT MCRAE: You heard this morning, and you probably understand the process that's involved. You will make a statement for a period of time, then you will be cross-examined by counsel for Claimants and then redirect by Respondents, and perhaps, further cross by the Claimants, and questions from the Tribunal.

I know it's difficult but we have to try to ensure that there is enough space between questions and answers for the Interpreters to complete what they

[Page 967]

say, because when the Interpreters are interpreting it's usually several seconds after they finish before it's time to start interpreting again. So, I would ask you and also counsel for Claimants particularly in cross-examination to try and keep that in mind. I know it's impossible to keep it completely in mind, because human nature wants to respond quickly, but just a matter to keep in mind.

Perhaps we could start by you making the Declaration that is in front of you. I think you should have a form, a written Declaration in front of you, if you could read that, please.

THE WITNESS: I solemnly declare upon my honor and conscience that my statement will be in accordance with my sincere belief.

PRESIDENT MCRAE: Thank you.

Counsel of the Respondents wish to start?

MR. GRANÉ LABAT: We can ask him whether he has any corrections to the two reports.

DIRECT EXAMINATION

BY MR. GRANÉ LABAT:

Q. Good afternoon, Mr. Missiego. I just want

[Page 968]

to ask you a couple of questions.

First, you have submitted two expert reports in this Arbitration. The first one is dated August 4th, 2022. And I would like to confirm whether you have it with you.

A. Yes.

Q. And my question is whether you would like to introduce any correction to the figures or anything in the 2022 Report?

A. None.

Q. Thank you. And same question regarding the Second Report that is dated May 7th, 2023. Would you like to make any correction?

A. No, none.

Q. Very well. The other issue, and here I'm going to switch to English.

MR. GRANÉ LABAT: Members of the Tribunal, Mr. Missiego has slides that he will use throughout his presentation. They are in English for the benefit of the Tribunal. He has, however, a Spanish translation of his presentation with him on the table.

That's something that I wanted to bring to the

[Page 969]

attention of the Tribunal and to opposing counsel.

PRESIDENT MCRAE: We have been given copies of the slides in English, and I assume in Spanish.

Are you displaying both languages on the screen or just English?

MR. GRANÉ LABAT: He will only display English but he will have a Spanish translation of those slides on the table.

PRESIDENT MCRAE: Thank you.

MR. GRANÉ LABAT: With that, we have no further comments or questions.

PRESIDENT MCRAE: Turn to Claimants for cross-examination.

MR. DÍAZ-CANDIA: What?

PRESIDENT MCRAE: Sorry. We hear his statement first. Yes. I'm running ahead of myself.

Mr. Missiego, can you please proceed with your statement.

DIRECT PRESENTATION

THE WITNESS: Thank you.

Mr. President, Members of the Tribunal, counsel for Claimant Kaloti, counsel for the

[Page 970]

Respondent State Perú. My name is Joaquín Missiego Del Solar. I am an attorney. I am also a professor at the law school at the Lima University. I've been there for more than 20 years. I also practice as an independent lawyer and I have done so for the last 20 years and I focus on procedural criminal--and criminal law. I also have Master's degree in procedural law from the University of Rosario in Argentina. I also have a specialization from the Salamanca University in Spain. I am also coordinator of the Criminal Law Department at the University of Lima. And the other pieces of information as to my professional or academic background can be found in the first appendix to my Report.

During my presentation, I will be addressing the topics--I will be addressing topics related to the Criminal Proceedings that are undertaken in Perú against Suppliers of Kaloti, [Redacted], [Redacted], and the [Redacted]. Throughout this Hearing, you were able to hear reference to these companies, and this has been the subject matter of the Arbitration of the last couple of days.

[Page 971]

Now, at the outset, I should state that, as an expert, I consider that the Precautionary Measures that had been issued in these four proceedings are in accordance with the law in Perú. I will be dividing my presentation into five sections:

The first one is related to Perú's fight against illegal mining and money-laundering.

The second section will refer to the Criminal Proceedings in Perú.

Third, I will be referring to the Precautionary Measures that are issued as part of the Peruvian, the criminal Peruvian process.

And, fourth, I will be analyzing the Petitions presented by Kaloti as a company before the Authorities, the judiciary.

And the fifth section will cover the Asset Forfeiture Proceeding and also the legality requirement for the protection of ownership rights under Peruvian law.

The first topic: Perú's fight against illegal mining and money-laundering.

Money-laundering is an activity intended to

[Page 972]

disguise, create hurdles, and hide the illicit origin of assets that are intended to be introduced into the financial system. This activity, unfortunately, is a scourge that has a very serious problem as a consequence for the Peruvian society.

The Peruvian State has faced issues relating to money-laundering and illegal mining for several years now, so much so that, in 2012, it was necessary to amend our legislation to address the current situation given this type of offenses. You may look at the name of the law, and that is Decree on the efficient fight against--effective fight against money-laundering and other crimes related to illegal mining and organized crime, so this gives you an early idea of the fight and also the area whereby Perú is showing concern about these activities and also the consequences they may have.

On Monday, during the First Session of this Hearing, we were able to see how the representative of the Peruvian State explained the irreparable damages produced by illegal mining in the system, and that goes from the environmental problems up to an impact

[Page 973]

on human life due to indiscriminate use of the resources--rather, mercury.

It is important for you to understand the context so that we can all understand the reasons why, not only in this case but also in other cases, there were interventions against Kaloti's Suppliers but all of the other processes underway in the country to combat illegal mining.

A Criminal Proceeding in Perú takes place as follows: First, we need to identify various stages. We have a stage that is the Preliminary Investigation. We have another one that is called "Pre-Trial Phase," "Preparatory Acts," and then "Trial." You may see here on the screen that they are all identified in red.

In blue, we see the Authorities in charge of each of these phases within the procedure in the country.

The Preliminary Investigation is results of a criminal notice. That is to say, the existence of suspicion indicia regarding the commission of an offense. And then, as the Prosecutor's Office starts

[Page 974]

to channel the investigation of that offense and upon learning of it as the process moves forward, more evidence is found that help determine the initial suspicion. And during the pre-trial phase under the old Code--that is to say, this is the way in which something that the Claimant's Expert and myself agree, this pre-trial phase is, under the purview of the Judge and it is a judicial stage in which various measures may be issued such as Precautionary Measures for the prevention of having the effects of the process consolidate.

The stage known as "preparatory acts" is quite important to the proceeding because, at that point in time, the Public Prosecutor will make a decision whether there will be an accusation or not. That's when they determine whether evidence is enough so as to determine that those individuals that are suspected of an offense to be considered the actual offenders. And it is for the Judge to determine whether those individuals will be liable for those offenses.

To the right, you can see the names of the

[Page 975]

Suppliers--rather, below and to the right you can see the names of the Suppliers, and that allows you to see where in the proceedings they are. In the case of [Redacted], and [Redacted], there has already been an indictment. And the case of [Redacted] is already in the trial phase. In the case of [Redacted], the pre-trial phase has come to an end, and a decision is being made whether there will be an indictment.

Now, the Precautionary Measures that may be issued during a Criminal Proceeding are personal or of an actual nature. That is to say, this is, in this phase, we're talking about Precautionary Measures that have an impact on things, on the goods. And, here we have different measures fumus bomi iuris that is reflected in the reasoning of the Seizure Measure that I have shown here on the screen in connection with Shipment No. 1. And as you can also see, to the left you have a relation to the other cases.

Now, what is the procedure? It is quite simple. The Office of the Public Prosecutor is asking the Judge to issue a Seizure Order. This request has to be properly reasoned, and upon analyzing the case,

[Page 976]

based on the petition received, the Judge independently, because the request to the Public Prosecutor is not binding. The Judge has to make a decision. , the Adjudicator has to make a decision.

And this is what we have seen these processes. As to the duration of these Precautionary Measures, we need to determine them as different from the Precautionary Measures on property or the personal Precautionary Measures.

We have heard that Claimant's expert has indicated that when a person has been in prison because of a Precautionary Measure, upon completing that term, the person has to be released. Yes, we agree. The door is open and the person is let free.

But given the complexity of the issues upon termination of that Precautionary Measure, the Judge may not open the doors to the vault and say, "okay, come and get it." So, there has to be some--this has to be done in compliance with some requirements to make sure that the gold is actually returned, but we cannot use the same principles for a Precautionary Measure on property or a personal Precautionary

[Page 977]

Measure.

So, here you have the Decision, the Judgment by the Constitutional Court that showed you that the Precautionary Measure may last in time as long as there are no reasons to modify the facts or the reasons that warranted their issuance. And here we have a citation referring to Mr. César San Martín, former Peruvian Supreme Court President, who has an opinion similar to the one issued by the Constitutional Court that the situation--it preserved the situation that existed when the crime was committed as long as the facts, the underlying facts, do not change.

And, finally, there has to be made a decision about its relevance or not.

MR. GRANÉ LABAT: Would you please slow down. This is for the benefit of the Interpreters.

THE WITNESS: At the time that the Judge decides to start with the pre-trial phase or at any stage of the proceeding, the Public Prosecutor may request the enforcement of a Precautionary Measure, and at any stage of the proceeding, that Measure may

[Page 978]

be revoked. And the reason is to maintain--this may be based on the maintenance or not or the survival of the reasons that led to the Precautionary Measures.

Based on the information that I had at hand in the documents, the reasons that led to the Precautionary Measures maintained throughout the process. They have not changed, so there has been no reason for them to be revoked.

Now, when we are referring to a seizure, we are referring to the suspicion about the existence of goods of illicit origin, and that's the reason why the State makes a decision such as the one that we're discussing.

On the screen, you have a slide showing a table with the name of each of the Suppliers. The intent here is to leave you with an example since I cannot refer to all of them. I can leave you with the an example of the indicia, the reasons that finally reasoned the Precautionary Measures. Among others--and you have already heard some of them, let me repeat. One of the legal representatives of one of the companies said that no document was signed, the

[Page 979]

digital signature was not the same, this was also evidenced in the work done to confirm the facts and also the area where the mineral--the mining took place was impossible to be confirmed, so there are some reasons that motivate--that support, the issuance of these Precautionary Measures.

As to the request for intervention by Kaloti, we have already seen those documents throughout this morning when Caro, as an Expert, had the opportunity to analyze the request before the judiciary. And I agree with him on the fact that we do not see in any of those requests any documents in which Kaloti evidences the property that they claimed they had. This is the first comment that, in my opinion, should be mentioned.

Now, as to the possibility that the Company Kaloti had to bring a case before the Peruvian courts, we agree that there is an option. That is an option.

You can also see that there are three options on the screen: One, there was the re-examination. The second one, appeal. Both can be part of a preliminary agreement that is the one found

[Page 980]

at R-0152, that is 5 of 2010, Agreement 5 of 2010, and then the Amparo Request.

In connection with the last topic, I would like to indicate that I was able to see that Kaloti does file an amparo, but it was dismissed before it was even admitted.

The request for intervention in the various proceedings by Kaloti, and these are the ones you have on the screen and the ones that I have mentioned, once again, did not provide the Criminal Courts enough evidence for them to support the property they said they had. This is important to bear in mind because the only one that can lift a Precautionary Measure is the Criminal Proceedings Judge; and, if that Judge does not receive the proper information, he or she won't be able to do so.

And Kaloti also presented before the Office of the Public Prosecutor a petition to reject the petition by SUNAT; and, in my opinion this is not the proper document, this is not a document that was presented based on the legal parameters because the one lifting the Precautionary Measure would be the

[Page 981]

Judge.

Now, the reasoning used by Kaloti given their presentation before the Judges is not only one proving that they are the owners, but they also stated that, in case there is no revocation of the Measure, there will be an application for arbitration since Kaloti is indicating that the mechanisms to protect Investment under the BIT are deactivated. So, their ownership of the goods is not evidenced, and they're saying "if you do not lift those Measures, I will file for arbitration, I will take the Peruvian State to arbitration." And this is not an element that is efficient to prove property.

And now, I am moving on to the end--to the conclusion, to the fifth section. And here, I would like to relate this to the first section. You should not forget the importance, the concern--of the concern the Peruvian has in their fight against illegal mining and money-laundering, and you should not forget also the changes in the Peruvian legislation to give competent authorities better tools and more tools for them to legally combat this type of activity.

[Page 982]

And within that, we also find the Asset Forfeiture Proceeding. This Proceeding is just a legal consequence that has an impact on the object, on the property, the goods that had been obtained in an illicit manner. Here, we're not referring to a criminal process that is aiming at identifying personal liability. Here, we're talking about a proceeding in which the Office of the Public Prosecutor has to present charges before a judge to prove the existence of facts that allow us to assume the illegality of the goods that are the subject matter of the Proceeding, and the Respondent has to prove that the goods are licit; that the goods are legal, are lawful; that they have an origin that is in accordance with the parameters under the law.

It is important to bear in mind that property rights are recognized, and they are not--no one would deny that, but to invoke that, we also need to be acting with legality. Legality is a key condition for someone to have property rights.

So, all of those acts that are contrary to the legal rules and regulations are null and void ab

[Page 983]

initio, so there couldn't be any protection in which there are goods that have not been properly obtained with just title or that are--or that are not compatible with the legal system.

Now, as to the acquisition of mining products, I am not an expert on Mining Law. My Reports do not address Mining Law, but I did review that the Mining Law in one of the Articles, that is Article 4, if my memory serves me right, indicates that any purchaser of mining products needs to verify, must verify the origin of such products, request the corresponding documents and so as to have certainty regarding the products and their authenticity.

It is also important to bear in mind that the purchaser of mineral products is also bound to verify the origin of the Mineral Resources. This is stated under the General Mining Law.

Finally, Mr. President, Members of the arbitral Tribunal, to conclude, I think that the four Criminal Proceedings, as an expert, that are being pursued against Kaloti, have been conducted in accordance with due process and in compliance with

[Page 984]

Peruvian law.

The Precautionary Seizure Measures that were

issued against Kaloti's Suppliers were issued

correctly, in a proportional manner, and they are

manners--they are measures that are suitable to

guarantee compliance with an eventual Judgment.

Kaloti's requests before the Peruvian

authorities did not comply with the formalities under

the law, and they were properly rejected.

Peruvian law only protects those rights over

property obtained with a good title in good faith;

that is to say, lawfully.

And, finally, in application of the Asset

Forfeiture Law, the General Mining Law, and also

Legislative Decree 1107, Kaloti should not or could

not be considered as a bona fide third party.

And I thank you all for your attention, and

I will be happy to answer any questions that Claimant

may have, the Arbitrators, and even Respondent.

Thank you very much, Mr. President.

PRESIDENT MCRAE: Thank you very much.

I turn to the Claimant.

[Page 985]

MR. DÍAZ-CANDIA: Thank you, Mr. President.

First of all, we are very happy to finally have the

opportunity to cross-examine someone since Perú

produced no witnesses of fact in this Arbitration.

With your grace, I'm going to switch to

Spanish.

CROSS-EXAMINATION

BY MR. DÍAZ-CANDIA:

Q. Good afternoon, Mr. Missiego. We have

coincided in these Hearings before, I'm Hernando Díaz-

Candia, I will not insist on rules for you. I'm sure

we may have some differences during our conversation,

but I am sure, and I hope that we can resolve them in

a civil fashion.

A. If I may, I need to ask a question, there is

a code to have access to my materials. May I get some

help with that?

Q. Yes, of course.

A. And if you could leave the password for me,

so it doesn't happen again.

(Pause.)

A. Thank you very much.

[Page 986]

Q. Very well.

We will start again. I'm not going to

impose too many rules because I am sure that any

differences we might have, I'm sure that we can

resolve in a friendly and civilized way.

My first questions have to do with

credentials and credibility regarding you and your

information. I know you have said on several

occasions that you believe that some of the

conclusions reached by Dr. Caro are incorrect, and we

respect that. I wanted to ask you at the same time

whether you consider that some of those conclusions

are absurd, that they have no scientific basis, or

have been outside of any scientific method? We have

seen the credentials of Dr. Caro. I simply wanted to

ask you a little bit about the context and the scope

of your disagreement with him.

A. Sure. I've had a chance to look at the

Reports of Dr. Caro and, based on that, there are some

differences of opinion between what he has said and

what I see as far as reality for some these matters.

In my perspective, I base on what you have seen in my

[Page 987]

Report. Even though we do speak the same language,

perhaps there are some words that don't have the same

meaning for both of us, and the terms that you have

referred to are terms that might be misunderstood in

my country, so in no way would I want to be

interpreted from my answer that I feel in the way that

you have said. It is a different opinion from a legal

perspective regarding some of these same matters that

we've both looked into.

Q. That's fine.

In your First Expert Report, in Paragraph 2,

and during your presentations--your presentation,

rather, a few minutes ago, you have said that you did

some postgraduate studies in Argentina. And when you

referred to what you specialized in, you simply say

that you have that degree.

Now, did you achieve the full Master's?

A. No.

When I talk about studies, Master-level

studies--and maybe that's an issue of language

again--in my country, you say that you have studied,

you say you have gone some of the way along that

[Page 988]

study. That's why I didn't say I had Master.

Q. Of course. And if you don't have the

Master's then you don't have a Ph.D. either, a

Doctorate?

A. No.

Q. So, the highest level of education, the

highest degree you've obtained is specialist, which is

below Master's?

A. Yes, in fact.

Q. Thank you.

Paragraph 4 of your First Report makes--or

highlights, probably, a case in which you represented

Perú before the Inter-American Court of Human Rights.

We will show it on the screen. Could you tell us

which case that was?

A. Yes.

In fact, and I want to underline that

because that was a very important case for my country,

and I had the honor of having been an alternate

representative for Perú before the Inter-American

Court of Human Rights, and it has to do with the

rescue of the hostages from the Japanese Embassy. The

[Page 989]

case is known as Cruz Sánchez. That was about

10 years ago.

Q. Thank you.

And, in that case, the Inter-American Human

Rights Convention and how it applies to Perú was

discussed; correct?

A. Yes.

Q. And Article 8 of that Convention establishes

the right to be--go through trial within a reasonable

period of time?

A. Yes.

Q. In that case, as far as you remember and to

the extent that this does not infringe upon any public

decisions--I know you have some confidentiality

matters to take care of with your client, but I

believe that Perú lost that case?

A. No. I will explain. It was a decision made

up of various parts. One held that the Peruvian State

had made use of legitimate defense, and thus had the

right to conduct that rescue operation in favor of the

hostages.

The other point that is related to what you

[Page 990]

have just said is the deaths of one of the terrorists

was not fully clarified, and it was said that Perú,

instead, needed to initiate or continue the judicial

proceedings in order to understand the responsibility

of those who had participated in the death of this

person whose name was Cruz Sánchez. So, there were

several aspects to this Judgment. It was not totally

negative for the Peruvian State.

And based on that case -- In Perú we know it

as the Chavín de Huántar commands case, because the

Armed Forces--members of the Armed Forces who

participated were released of any responsibility, and

it wasn't the commandos who had been involved in this

action with Cruz Sánchez, and that's what needed to be

investigated.

Q. So, was Perú, under international law,

declared liable?

A. In the case of Cruz Sánchez, yes. In the

case of the use of legitimate force or legitimate use

of force, again, I also wanted to point it out.

Q. It was also declared...

A. No. It was declared that they had the right;

[Page 991]

there's one aspect of the Judgment that does go

against Perú.

PRESIDENT MCRAE: Wait a little bit because

we're still trying to catch up with the interruption,

three or seconds before the question. Thank you.

(No interpretation.)

BY MR. DÍAZ-CANDIA:

Q. In your First Expert Report, in Paragraph 6,

you referred to criminal law and criminal procedure

law. That exam has taken into account, I suppose, at

least as something that informs the interpretation of

these standards, the Constitution of Peru.

A. I'm sorry, I don't understand the question.

Q. Did you take into account the Constitution

of the Republic of Perú when you referred in your

Expert Report to Peruvian criminal law and criminal

procedure law?

A. For the preparation of these reports?

Q. The Constitution.

A. Yes.

Q. Is it correct or not that the Peruvian

Constitutional Courts have recognized that that

[Page 992]

Constitution includes--and I don't know which Article

it is or whether it's just a consequence of an

article--the right to be judged or to undergo trial

within a reasonable period of time?

A. Yes. Without mentioning an article, what

you say is true.

Q. Let's go for a moment to Paragraph 153 of

your First Report, where you cite Article 102 of the

Criminal Code.

I would like to know whether we are in

agreement about the fact that there is a part missing

in your quote, in your citation of that Article.

There's a part that's missing.

A. If I may, in the last two lines refer to the

seizure determining the transfer of the goods, so yes,

the Article continues.

Q. I will read to you how it continues, and you

can tell me whether you agree or have any objections

or if that's not how you remember.

If the seizure of the results of the crime

cannot be seized because they have destroyed,

consumed, or had been hidden or transferred to bona

[Page 993]

fide third parties under a title or for any other

similar reason.

So, this Article suggests that the transfer

to bona fide third parties can prevent the seizure of

the goods or assets. Do you agree?

A. Yes.

Q. So, this complements an article from the

Civil Code about which Professor Knieper was asking

today.

So, you would agree that this has effects

that are in favor of the good-faith Buyer, even when

there is a seizure of the results or the proceeds of

that crime.

A. Yes, as long as we're talking about a

good-faith Buyer.

Q. Okay. Thank you very much.

In Paragraphs 8 and 9 of your First Report,

you refer to crimes such as money-laundering and

illegal mining.

In your Report, you also explain that the

crime of money-laundering is autonomous, separate from

that of illegal mining. And we know and we are aware

[Page 994]

that judicial resolution, some of them refer to

money-laundering related to illegal mining. But, in

the strictest sense, you also point out that it is not

necessary, it's not even necessary to investigate

illegal mining in order to reach a sentence on money

laundering; is that correct?

A. Yes, and it's based on Article 10 of the

Decree 1106, I'm sure you will ask about that later.

Q. Thank you. And in these proceedings against

the four Kaloti Suppliers, what is being investigated,

strictly speaking, is money-laundering; correct? The

crime of which some of the Suppliers are accused is

money-laundering.

A. Let me think back.

The case that is already in the trial phase

is money-laundering with an aggravating factor, which

is illegal mining. But, if we're talking strictly

about money-laundering cases, then yes.

Q. Please go ahead.

A. No, that's it.

Q. So, in those cases, is the illegal mining

itself being investigated, and can there be a sentence

[Page 995]

for money-laundering without even determining whether

there has been illegal mining?

A. Yes, that can be done.

Q. Thank you.

Gold that was mined and showed in full

compliance with Peruvian law, there is no doubt that

the gold is legal, of legal origin, it can later be

used by a Buyer for money-laundering. "Yes" or "no"?

A. In general terms, yes.

Q. Thank you very much.

It's true that, for a conviction based on

money-laundering, evidence is required that goes

beyond any reasonable doubt, as you say in

Paragraph 12 of your First Report and then in Page 3

of your Second Report at Paragraph 9. That's the

standard for evidence, "beyond any reasonable doubt."

A. And I would say, if I may, that it's not

just for this crime for any conviction, there is a

standard of proof that is beyond any reasonable doubt.

Q. Thank you very much.

In your Report at Paragraph 11, you refer to

suspicions on some of Kaloti's Suppliers; is that

[Page 996]

correct?

A. Yes, but if I may?

Q. Go ahead.

A. The standard you just asked me about in the

previous question for a conviction is one thing.

Another thing is a standard for an investigation to be

initiated. I said that during my presentation.

As the process develops, a higher level of

evidence is required in order to confirm the initial

hypothesis.

Q. So, the standard for initiating an

investigation is lower, then it increases for the

indictment, and then it's even higher for that of

final conviction?

A. That's correct what you say.

Q. Thank you.

In Paragraph 142 of your Second Report, you

refer to a decision from 2022 by a Civil Court that

held in favor of [Redacted], with a [Redacted] at the end, and

declared a contract to be terminated; correct?

A. Are you talking about Paragraph 142 of the

Second Report?

[Page 997]

Q. There is a decision from December 22nd.

A. I do mention that Decision that you are now

referring to, but I don't use the word "Contract."

Q. What did the action by [Redacted] against Kaloti,

what was it? It was a civil action regarding Shipment

No. 5.

A. No, I understand that, but in your question

you say that I have used the word "Contract." What I

want to say is that the word "Contract" is not there.

It was a Civil Proceeding and as we all heard this

morning, we know what it was about. It was a dispute

among private parties between [Redacted] and Kaloti.

And, in this particular case, from what I

could see in that Resolution, in that Decision--

Q. No, finish reading then let us know, and

we're going to show another paragraph on the screen.

A. Could you repeat the question, please?

Q. Let me show the First Report Paragraph 152

or 153. It says: "Thus, the Contract signed by both

Parties regarding Shipment No. 5 is now terminated."

Which Contract specifically was terminated

then?

[Page 998]

A. What I'm doing there is citing what the

Resolution says: The Courts made this decision, and

what did they state? That that Contract signed by both

parties regarding shipment 5 was terminated. That's

what the Court's Resolution says.

Q. That means that there was a contract on

Shipment No. 5 between [Redacted] and Kaloti.

A. Yes.

Q. Was there a contract, yes or no?

A. Yes. I haven't seen it. What I'm telling

you is what I'm reading in this Resolution.

Q. And you read the Decision?

A. Yes.

Q. In your First Report in Paragraph 13

regarding the Precautionary Measures, you refer to

goods that are the property of third parties; is that

correct?

A. Yes.

Q. It doesn't say "assets in the possession of

third parties"; correct?

A. Correct.

Q. In Paragraph 14 of that same First Report,

[Page 999]

you say that gold--the gold can go into the possession

of the State after the conclusion of the Criminal

Proceeding, it says: "At the end of the Criminal

Proceeding". What is that? A final decision?

A. When it ends, as you say, with a definitive

decision.

Q. Conviction?

A. Yes, of course.

Q. In the four investigations, and we will see

later if the investigation on [Redacted] includes

Shipment 4 or also Shipment 5. In one of those, has

there been a final decision as far as you know?

A. No. As I explained in my presentation,

these proceedings are still in progress.

Q. So, those four or Five Shipments, under

Peruvian law, have not continued on to the possession

of the State?

A. Correct.

Q. In Paragraph 15, you later refer to a number

of rights that third parties might have when they are

impacted by Precautionary Measures issued in the

context of a Criminal Proceeding. These are--

[Page 1000]

A. Yes.

Q. These are not obligations or burdens of

those Parties?

A. No. I'm talking about rights. That's

clear.

Q. Great, thank you very much.

In Paragraph 155 of your First Report, you

literally point out that, in the case that Shipments 1

through 5 are determined to have been the subject of a

money-laundering crime, so this says clearly 1 to 5,

so I'm not clear because, in other paragraphs of the

same report, it's not clear whether Shipment 5 is

being investigated in this proceeding against [Redacted] or

not.

A. Well, in principle, what I'm saying--and

you've highlighted it in yellow--is that, in the

event--in the event that it is determined that the

shipments you've said were determined to be the object

of a money-laundering crime--I'm not saying it has

been done; I'm saying in the event that this should

happen--and what we need to bear in mind here is that,

in the Asset Forfeiture Proceeding, as I said during

[Page 1001]

my presentation, we're not talking about individual

criminal liability, even if there is a Civil

Proceeding as there has been. If it is later

determined that the asset is the result of a crime,

through the Asset Forfeiture Law the State has the

right to initiate the relevant legal action.

So, in the event that it is determined that

these were the object--these shipments were the object

of a crime, then it is perfectly viable for Kaloti, or

whoever may have the right, would not receive those

assets, and those would go into the possession of the

State.

Q. But your Report refers to judicial decisions

on four shipments. My specific question is about

Shipment 5 because here you refer to Shipments 1

through 5. Is it being investigated or not?

A. Let me see.

I understand that Shipment 5 was included

within the Criminal Proceeding along with 4. That's

what I remember.

Q. Perfect. Thank you very much.

In Paragraph 23 of your First Report you say

[Page 1002]

that the Prosecutor's--Public Prosecutor's Office

conducts an analysis that is objective and

independent, or that's what it did; is that correct?

A. Yes.

Q. Did you have access to the entire record

from the Public Prosecutor's Office, and did you see

everything that is in that record regarding those

Criminal Proceedings?

A. The entire record, no.

Q. So, you formed an opinion on what they did

without knowing whether there are other documents from

the Public Prosecutor's Office?

A. On the basis of the documentation that I was

able to review in this case, the initiation of the

action where it is explained what there was, and in

the Constitution which also recognizes the Public

Prosecutor's Office as the entity that has the

authority to initiate and direct the investigation,

that's why I say that they decided formally to start

these Preliminary Investigations, and that provides

better context for the paragraph.

Q. Thank you very much.

[Page 1003]

In Paragraph 134 of your First Report, you

refer to the reserve of the investigations; and, in

Paragraph 135, you say that the files or the records

are reserved in order to protect the investigated

party privacy.

A. What paragraph is that?

Q. 134 of the First Report and Paragraph 135 of

the Second Report--of the same Report, rather.

They're on the screen.

A. Yes. It says it there.

"It should be noted that the investigation

stage in Criminal Proceedings in Perú is, according to

the law, reserved or confidential", but that is not

the phase we are in as I explained with my slides,

that phase has passed, and now it's a different phase.

And what we have is a Prosecutor that's making a

decision about whether to file a formal accusation or

not. So, it's the investigation stage.

Q. So, there is no formal accusation?

A. There is no accusation, maybe other

actions--sorry, there is no formal accusation and no

other requests--the Public Prosecutor's Office is

[Page 1004]

independent and can make a decision in that regard.

But what I'm talking about here is the investigation

phase where the Prosecutor decides whether to file

that formal accusation or not. That phase is done,

and now we are in the phase, it's an intermediary

phase in the new Code. What I say here, and I think

that's what you're talking about, is the investigation

phase in Criminal Proceedings.

Q. And then you talk about the reserved or

confidential nature of the process with the goal of

protecting the integrity of the investigation and the

rights of those being investigated.

A. Yes. And again, this is confidential nature

is orientated for the investigation, for the

investigated.

Q. Exactly, but let's imagine that in 2014 or

2015, these four files were confidential and reserved.

A. My Reports are from August 2022, so, on the

basis of what you said, I would answer "yes," but now,

in connection with the documents that I have examined,

well, those documents were prepared in 2022 or late

2021. So, in 2022, that was under seal. They were

[Page 1005]

confidential.

Q. Okay, then we can agree that in 2014 they

were confidential or, at least, in your words, they

were reserved if they hadn't gone to the phase to

decide on the accusation.

A. Sir, to be clear, any proceeding during the

investigation stage.

Q. Okay, but these four files--

A. In 2014, they were being investigated.

Q. Okay. So, in 2014 they were confidential?

A. Yes. They were confidential.

They were under seal.

A. Well, confidential nobody can see it.

Reserved, the Parties are the only ones who can see

it.

Q. The parties. Very well, so, not the press.

A. Well, the press would not be able to see the

documents, but sometimes in my country, like in other

countries, the press provides information of

proceedings that are happening. But if you say that

in 2014 they were under seal, they were under seal.

Q. That's fine.

[Page 1006]

If they were under seal, how is it that the

information on those four cases got to the hands of El

Comercio, the press?

A. I don't know.

Q. The State of Perú had, the court and the

Prosecutor had an obligation of confidentiality.

A. Yes.

That is not the only case in which this

happened. Every Sunday, we have the same thing.

Q. So, confidentiality of Criminal Proceedings

is violated every Sunday?

A. No. That's not right. The Parties

themselves can leak the information to the press, but

that would be speculation on my part.

Q. Why would a party that is being investigated

leak information? The Party wants the press to know

this?

A. Well, maybe they do it to exert pressure.

Q. Perhaps the Civil Tribunal, the Court or the

Prosecutor leaked the information to the press?

A. Yes. Any of those things can happen?

Q. At Paragraph 25 of your First Report--and

[Page 1007]

going back to your question: How is it that you had

access to the documents that were appended to your

Report in connection with the four cases?

I think you've heard this morning the

statement by Mr. Caro. Was there a decision by the

Court or the Prosecutor granting you access to those

files?

A. The documents I was able to obtain were

documents that I asked the lawyers for Perú to provide

to me. I've had no direct communication with the

Authorities in Perú. Any information that I deemed

necessary, I requested directly from Perú's lawyers.

Q. Are you making reference to the Commission

representing the State or Arnold & Porter's counsel?

A. I'm referring to Arnold & Porter's lawyers.

Q. [Redacted]

[Redacted]

[Page 1008]

[Redacted]

[Page 1009]

[Redacted]

[Page 1010]

BY MR. DÍAZ-CANDIA:

Q. We determined before that the judiciary

conducted an exhaustive analysis of each case before

showing the Precautionary Measures. That is at

Paragraph 25 of your First Report. You also told me

that you did not have access to all of the documents

from those cases.

These are not questions. I'm just telling

you what happened today.

How can one conclude that the judiciary

examined everything exhaustively if you do not know

what "everything" is?

A. It says here, "after exhaustively

analyzing." It doesn't say "everything." But apart

from that, the judicial decision that brought about

the Precautionary Measures, that is a decision that

provides the reasons why the Measures were issued, and

that is what I am making reference to. If we look at

the judicial decisions that I'm making reference to,

you're going to see that those decisions contain an

explanation of the background of each case, the

evidence and indications that was obtained to arrive

[Page 1011]

at the Decision made at that time.

Q. Yes, but, in theory, in that file, perhaps

there is evidence submitted by the four investigated

parties that you may not have seen?

A. Yes.

Q. Okay. Thank you.

At Paragraph 21 of your First Report, you

talk about an attachment against Shipment 5.

Do you know who was the custodian or

guardian of that shipment via that attachment?

A. I do not recall. I don't have that

information.

Q. Do you know or has someone told you during

your investigations where Shipment 5 is today?

A. No.

Q. Let us look at C-0141. It says here--and

correct me if I'm wrong--"a Precautionary Measure is

issued on the merits as an attachment on

99.843 kilograms of gold." Well, it says "kilograms"

here but it was "grams." "99 kilos, that are

deposited on behalf of Kaloti Metals & Logistics in

the facilities of Hermes located at," and then it says

[Page 1012]

"the Banco de la Nación is the depositary of the

seized property"; is that correct?

A. This is correct, on the basis of this

decision that we've read.

Q. Thank you.

At Paragraph 37 of your First Report, you

also say that the unlawful origin of the property must

be known or presumed by the offender, and you cite

R-0218. We see that. Is that correct?

A. Indeed.

Legislative Decree 1106 has two Articles.

The first one--and the drafting is very similar, and

the phrase matches here. It talks about money,

effects, or goods, the illicit origin of which is

known by that person.

So, here they talk about a certain level of

diligence. Diligence that must be exerted from the

individual participating in these activities. That is

why I'm making reference to the language in the law.

This is at Articles 1 and 2.

Q. Yes. I'm showing those on the screen.

That's on the Hearing Bundle. Here it says: "Anyone

[Page 1013]

who converts or transfers money, goods, effects or

profits who's illicit origin he or she knows or should

presume, in order to avoid the identification of its

origin, seizure or confiscation will be punished with

the custodial sentence of no less than eight and no

more than 15 years and with a penalty."

A. Yes.

Q. Is it your opinion--and correct me if I'm

wrong--that KML knew or should presume that the gold

it purchased from the four Suppliers was of an illicit

origin?

A. I think that at least it should have

presumed so. since we have this on the screen, let's

look at Article 10.

Q. Yes, let's go ahead.

A. Article 10 says that money-laundering is an

autonomous offense for its investigation and

prosecution. It is not necessary for the criminal

activities that produce the money, property or effects

of properties to have been discovered, be subject to

investigation, judicial proceedings or have previously

been subject to evidence or conviction.

[Page 1014]

My understanding is that both Article 1 and

Article 2 that you referred to, well, we cannot read

them in isolation without looking at the first part of

Article 10.

Here, they're indicating to us the standards

that must be met. An investigation in the matter was

no longer necessary or proceedings in that regard.

This Article requires a certain level of diligence.

In answer to your question, that is what I

can say.

Q. You consider that KML committed this crime?

"Yes" or "no."

A. What I think is that, on the basis of the

documents I have been able to review, there wasn't a

sufficient level of diligence by Kaloti, and I cannot

affirm this 100 percent, but when Kaloti started

dealing with this group, this group that is now being

criminally prosecuted.

Q. Okay. Very well. Just to

understand--please correct me if I'm wrong--KML knew

or should have known the illicit origin of those Five

Shipments?

[Page 1015]

A. From what I have seen, it should have at

least presumed that it was facing a strange situation.

Q. Under criminal law in Perú, KML should have

been subject to seizure--or, rather, should have been

accused.

A. At least it should have been included in the

proceedings.

Q. Okay. And we agree that it wasn't.

A. It wasn't.

Q. We understand that you have called into

question the suitability of certain communications or

miscommunication used by Kaloti to communicate with

the Courts, with the Prosecutor, et cetera. KML told

the Peruvian authorities--and there is a letter that

is being used here in connection with the temporal

limitations of the Treaty, but KML gave notice to the

Peruvian Government that--and I understand you said

Kaloti Metals was not the Owner, but KML indicated

that it was the Owner of those Five Shipments, and

you're saying that Kaloti Metals should have presumed

the legal origin of those Five Shipments, so Kaloti

Metals should have been accused or charged at least,

[Page 1016]

no?

A. The fact that KML was not included in the

proceedings does not mean that it had the right to

sue, and I explained this during my presentation.

What I am calling into question, in connection with

this second issue, is that it didn't so in an

appropriate manner.

I don't think that someone who comes to an

authority by simply saying "I am the owner" or by

simply stating something, I don't think that is enough

for the authority to presume or declare it the owner.

If Kaloti submits documents to the

authorities, not to the Government. Remember there is

a separation of powers in Perú. But if KML submits

documents to the judiciary, to the Courts, and to the

Public Prosecutor's Office and it says "I am the

owner" but it does not evidence that, the judicial

decisions have indicated this that KML has not

evidenced the ownership that it claims it has, I do

not find any reason on the basis of the file that

Kaloti should have been included in those proceedings.

Q. But you said that it should have been

[Page 1017]

included.

A. Well, in my personal opinion, it could have

been included in the proceedings if the name of the

Company appeared in the initial documents.

Q. Okay. That satisfies us.

You just said that there is perfect

separation of powers in Perú. In our file, we have

alleged that Pedro Castillo is currently incarcerated

because it tried to undermine the independence of the

judiciary.

A. Yes.

That proves Perú's separation of powers,

since he tried to respect that, he's now incarcerated.

Q. Or because he didn't respect it; right?

A. Okay.

Q. I don't think that this is a matter that is

included in your Report.

Let us look at Article 94 of the Criminal

Procedure Code of 1936. Let us look at the full text.

You agree that this Article contains two

subparagraphs that are different: (a) talks about

preventive Attachments that are sufficient to cover

[Page 1018]

the payment in the case of civil redress, so this is a

specific assumption that doesn't necessarily include

crimes that are potentially the fruit of--rather,

property that is potentially the fruit of crimes.

And then, in subparagraph (b), there is

another case completely different that says the

seizure may be ordered of the objects of the offense

or of the instruments with which it was committed, as

well as the effects, be they goods, money, profits,

etc. The seizure of the effects or instruments of the

crime or any product of the criminal offense even if

they can be in the hands of third parties. It doesn't

say here that are the property of third parties but

are in the hands of third parties. Correct? What does

"in hands of third parties" mean?

A. Yes, that can be possessors.

Q. So, no mention is made here of ownership

A. Well, "in the hands" may mean a number of

things.

Q. Yes, I think we understand what this means.

We understand that here they are not

referring to ownership; right?

[Page 1019]

A. Yes.

Q. Let us now look at (c).

I understand that you have said that there

is a difference between reservation of ownership and

asset forfeiture. You said, first you have to finish

the Criminal Proceedings, and then you can start the

asset forfeiture. There was a reform after that that

allows for the forfeiture to start without a final

ruling or a final judgment.

So, in 2014 or 2015, you could not start

asset forfeiture without a final judgment; is that

right?

A. Yes. That is part of the evolution of

criminal law.

In the past, any consequence had to do with

determining the liability of an individual, but now

there are other alternatives. Without necessarily

convicting an individual, you can go after the

proceeds of the crime, so this is an evolution of

criminal law in time.

Q. Very well.

Let's look at (c), regardless of your

[Page 1020]

position that, back then, one could not formally start

asset forfeiture procedures.

(c), which comes after (b), and, of course,

Article 94 is not in the section on termination of the

case of final judgment. This has to do with

Provisional Measures; right?

A. Yes. It has to deal with attachments and

seizures.

Q. Okay. The whole Article has to do with

Provisionary Measures, not final judgments?

A. Yes. It has to do with attachment, et

cetera.

Q. And here it says, the Judge shall give

Notice to the provincial prosecutor, criminal

prosecutor, on duty of the existence of the effects,

objects or instruments of fruit of the crime or any

kind of element that is born of a criminal infraction.

the courts of the four or five

investigations, did they let the provincial prosecutor

know about the existence of instruments of the crime?

A. No. The reverse happened. The Prosecutors

asked the courts to issue a seizure measure.

[Page 1021]

Q. Okay. The Court ordered the seizure, and

your position is that it did so because it was

presumed that these crimes were--these pieces of

property were the fruit of crimes.

A. Yes.

Q. So, after the seizure was ordered, the Judge

had to give Notice to the provincial prosecutor on

criminal matters on duty the existence of instruments

was a crime; right?

A. Yes.

Q. Have you seen any document that allows you

to conclude that that communication to the provincial

prosecutor on duty was made?

A. Not out of the documents that I was able to

see.

Q. Okay. Thank you. We also

agree--right?--that the asset forfeiture procedure

started in 2022, and only in connection with one of

the shipments. Is that correct?

A. Yes.

If you allow me, if we can continue calling

it that, but in the past it was called in a different

[Page 1022]

manner, but it's now called "asset forfeiture," so I

don't want the Spanish terms to be misinterpreted,

"pérdida" or "extinción" are the two terms in Spanish.

Q. Okay. So, whether you call it "pérdida" or

"extinción," it only happened in connection with four

or five of the shipments?

A. That's right.

Q. Let us look at Paragraph 43 of the Second

Memorial by Perú, the Rejoinder on the merits. This

is a Legislative Decree, Legislative Decree 1373,

Asset Forfeiture Regulations.

And it says that, in accordance with these

regulations, Claimant--Kaloti, in this case--had to

prove that Kaloti acquired the property and the legal

title of the gold and that during the purchase, it

acted in a faithful and honest manner.

Let us look at Footnote No. 19. In your

Second Report at Page 119--or rather Paragraph 119,

you talk about that same Decree, the Legislative

Decree, which is Number 1373, on asset forfeiture,

which came into force on 2 February 2019. How could

this Decree apply to what Kaloti Metals had to do in

[Page 1023]

2013 or 2014, if this is a 2019 Decree?

A. Could you please show the other citation in

English?

Q. Yes. It is Paragraph 43 of the Second

Memorial by Perú.

A. It is true that I showed my presentation in

English because there are some arbitrators who do not

speak Spanish fluently, but I do need to read this now

slowly.

Q. Of course. Go ahead.

A. Thank you. Agreed.

And you told me it was 119 in

your Second Report.

A. what was your question?

Q. The Decree that Peruvian lawyers referred to

in this arbitration, you were saying that it was--it

was enforced in 2019.

A. Yes, indeed.

Q. How could this Decree apply to what Kaloti

had to do in 2013 or 2014?

A. I do not understand your question. What is

it when you're saying, how could this be applied? I

[Page 1024]

understand that it couldn't be applied.

Q. This Decree--

A. By 2014, the Decree of 2019 cannot be applied. I think that we agree, but now the question is not clear to me.

Q. You already responded. Nothing else is needed. Thank you.

PRESIDENT MCRAE: Mr. Díaz-Candia, can we talk about timing? Because we're at the point where we'd normally take a break. It's not in accordance with the Schedule.

MR. DÍAZ-CANDIA: At least one more hour.

PRESIDENT MCRAE: So, we should take a break now?

MR. DÍAZ-CANDIA: Whatever you say.

PRESIDENT MCRAE: So, why don't we take a break now. So, a 15 minute break, and come back at 4:15 or 4:17, if you want to be precise about 15 minutes.

THE WITNESS: Thank you.

(Recess.)

PRESIDENT MCRAE: When you're ready.

[Page 1025]

Mr. Díaz-Candia, whenever you're ready.

MR. DÍAZ-CANDIA: Thank you.

BY MR. DÍAZ-CANDIA:

Q. We continue, Mr. Missiego. We are about to finish. Just bear with me.

This is Exhibit R-0013. That is the General Mining Law, and I will be referring to Article 4 because you cite it in your Reports.

This Article reads that the mineral products bought from authorized individuals are not claimable. The purchase carried out to a nonauthorized person subject to the responsibility of the purchaser, and then you're saying that the Buyer is compelled to verify the origin of the mineral substances.

So, first, the breach of this Article, is it of a criminal nature?

A. Is that your question?

Q. Yes.

A. In principle, as I mentioned, I was citing to this Article without being a mining expert.

Clearly, it is not a criminal law. There is no legal consequence. We're talking about Mining Law. That's

[Page 1026]

all I can tell you.

Q. And then, do we agree that the problem with this Article is - that the gold is purchased from an unauthorized person? However, as far as we have seen, the four Sellers of the Five Shipments were registered with RECPO at the time the purchase took place, and even they were registered with RECPO in 2018 or 2019. The RECPO authorizes them.- Someone may understand that they were authorized. Is it correct or not?

A. Yes, but I would like to see that at Article 4, the reference in my Report is based on the last line. The obligation the purchaser has to verify the origin of the mineral substances. The context in which I am presenting this Article indeed is related to the questions I have as to the operation.

Q. Sure, but I am trying -to get to the legal consequence of this Article. When it refers to the transfer of the property right, the problem here with the Article or the assumption is that it is bought from an unauthorized person. And later on, it says that the purchaser has to verify the origin of the Mineral Resources, and you're saying that this is not

[Page 1027]

of any criminal effect but what is the consequence of not verifying the origin of the Mineral Resources? That's- where I would like to get.

A. Under criminal law, we hear about complete, incomplete criminal provisions and blank criminal provisions. When we're saying that they are blank, it means that the criminal law has to resort to a law outside the criminal scope to understand the concept of the criminal -of- a potential Criminal Code.

So, legislative decree 1106, as you mentioned a couple of minutes, indicated that the person that would know, should know, or assume.

So, within that context, I place Article 4, the last section of Article 4 in connection with the obligation to verify the origin of mineral substances. As to the rest of the Article, there is no reference to that. I am not referring-I'm referring here to the link between "should be -s'med." So, what am I being asked for me to be able to assume something? At least, to verify the origin of the mineral substances. This is the context of the phrase. And then, what you're saying that is already here in the law is not

[Page 1028]

the subject matter of my Report, is not my area of specialty. I wouldn't be able to go beyond the reference I made to the comment related to Article 4.

Q. I understand, but so that the Transcript reflects this and so as not to put in your mouth words that you have not said, you said a couple of minutes ago that someone may interpret that if the person is registered in the RECPO, the person is authorized to sell gold.

A. I have not talked about the RECPO or authorization to sell gold. I never mentioned the word "Registry." You did.

Q. Yes.

And I asked you whether it would be reasonable to interpret that someone, an authorized person, is the one that is registered with RECPO. That is the question that you answered in the affirmative fashion. This is at-and it is true that I am the one who referred to RECPO first.

A: Agreed.

I said, before The four Sellers of the Five Shipments were registered with RECPO at the time the

[Page 1029]

sale took place with Kaloti, and they were even in the Registry in 2018-2019.

So, RECPO authorizes them or at least someone could assume that they are authorized to sell gold. "Yes" or "no"? You said "yes." But then, you expanded with an explanation saying that, in Article 4, there is reference to a report, but you answered -your answer to my question was in the affirmative. -Thank you.

A: Ok.

Q:You just mentioned Decree 1106. We're going to look at that.

I apologize. It's 1107, rather. 1107. There, it is referring to the responsibility of the purchaser, and we have heard several references to this from Perú and also by Mr. Caro.

My question in connection with this Article and this Decree is that you are aware of any other decree from 2013 and you do not refer to it in your report ----, and I am just asking you whether you're familiar with 032/2013/EM of August 2013. This

[Page 1030]

decree, refers to strengthen the plan, the miner's plan. And I don't- know if you are familiar with this Decree. As we have read it, and if you do not know this decree you do not have to answer me if you do not feel comfortable with the answer.

This Decree has extended certain-has provided or expanded certain terms for the miners to present documentation, and this also allowed them to continue to operate at least until mid-2014 with just a Declaration of commitment.

Do you have any idea about this? What can you tell us about what I just mentioned or whether, in general terms, this plan had any impact, any temporary impact on Article 11 of 1107?

A. I wouldn't be able to answer that question. This is something that is not within my area of specialization. I heard that you said "miner." Correct?

Q: Correct.

R: "EM," EM. This is not my area of specialty. "M" stands for mining.

[Page 1031]

Q. But could we agree that in 2013, early 2014, the process for regularizing miners was underway?

A: Agreed.

Q: So, now we're going to look at Law 27.379, Article 4, that you referred to this morning that -rather, Dr. Caro mentioned this morning. This is an Article- -and before that, please confirm me if I am wrong. -The four shipments, the four seizures of the shipments referred to Article 2 of this law, and then it says that the adjudicator should reason their Judgment; that there can be an appeal within 24hours, and that both proceedings will be confidential; and that the adjudicator will also determine the deadline for the Measures; that it cannot exceed 90 days; that this will be also communicated to the Public Prosecutor; that there will be reference to the name of the person investigated and other data to complete the Proceeding. And then, also, the adjudicator will enforce the Measures, the Criminal Judge will enforce the Measures, and also- complete the process.

[Page 1032]

So, once the Measures are enforced, the Criminal Judge will communicate this to the affected Party who, within three days, will be able to appeal.

And I understand that you're saying that this appeal was one of the remedies at hand for Kaloti.

MR. GRANÉ LABAT: Before the Expert answers, I would like to note that there is a discrepancy between the Parties as to this law because there is a different version, and this has been presented by this Expert as JM-025, so we think that it is proper to show him the current version of the law that is the attachment, the exhibit or the appendix to Mr. Missiego's Report.

MR. DÍAZ-CANDIA: CL-044 is where this law is in the record and has been there for some time, so far nobody had questioned its veracity.

MR. GRANÉ LABAT: It's not a matter of veracity. It's just about whether it is a current law or has it been derogated totally or in part.

MR. DÍAZ-CANDIA: But as the President has said several times, you can present this argument

[Page 1033]

later. I'm referring to what is in the record, and I think I have a right to that.

MR. GRANÉ LABAT: You have a right to refer to the current one, and that is JM-025. If you want to ask questions about a law that has been derogated, please, I want the record to show that that law is not current.

MR. DÍAZ-CANDIA: I ask on the record. He cannot limit my questions that I ask, if the document is on the file.

MR. GRANÉ LABAT: If you want to provide false information for the Tribunal, that's great, but we're not interested in doing that.

PRESIDENT MCRAE: I'm not quite sure that we've caught up here.

So, your concern is that this is not a current law, and Mr. Díaz-Candia, you may disagree as to whether that's current?

MR. DÍAZ-CANDIA: We will drop it. We're not interested in adding this Arbitration with petty stuff. We referred to the law that Mr. Grané wants. Can you project it?

[Page 1034]

Let's go to the last paragraph of Article 4, and you can tell us if this is the correct exhibit, please, Mr. Grané.

MR. GRANÉ LABAT: JM-25?

MR. DÍAZ-CANDIA: Yes.

The Article. Okay.

This paragraph in the law you cite says that the Criminal Judge will immediately make this known to the Party affected by the Measure who within three days will be able to file an appeal questioning the legality of the Resolution.

BY MR. DÍAZ-CANDIA:

Q. That appeal remedy regarding those Measures is something you've said is something that Kaloti had access to. "Yes" or "no"?

A. Yes.

Q. Do you know whether Kaloti --and the Article clearly says that-, in order for that appeal period to start running, there has to- be a notification first. Have you seen any document showing that these Measures were notified to Kaloti?

A. No.

[Page 1035]

Q. Thank you.

Let's refer now to something you said during your presentation. You talked about recourse that Kaloti filed before 2016 regarding two shipments.

That Constitutional Amparo Judge, under Peruvian law, had jurisdiction and authority to convict the Peruvian State over a violation of the Free Trade Agreement, the TPA between the United States and Perú.

A. I'm going to give you a rather general response based on what I understand. I understand that what is being argued is an attack on the right to property. A judge that looks at an amparo action looks at whether a constitutional guarantee has or has not been violated.

And now I'm speculating.

Q. Go ahead.

A. I don't think a constitutional judge would have gone into analyzing the scope of a treaty.

Q. Thank you. We consider that response to be sufficient.

Let's talk, then, about the duration of this proceeding, and specifically the judicial seizure of

[Page 1036]

four or Five Shipments.

Somewhere in your Report, you say that periods of time that are not in the law cannot be imposed. However, we agree that the Peruvian Constitution establishes a right to have Judgment within a reasonable period of time; correct?

A. Yes. I see what you're saying, but I would like you to show me the part of the Report or, as you have been doing, to show me which -or tell me which paragraph. I have no doubt about what you're- saying, but I would like to see the context.

Q. Don't worry. We have it in this morning's Transcript and in the Closing Arguments, we can discuss whether what you said is what is there or not.

If a law does not establish a temporal limit, a time limit, to Precautionary Measures, does it mean they can be eternal?

A. In the case of a Precautionary Measure, which is what I think we're talking about -now, it's a Precautionary Measure on -property-I haven't found anything that says- -a law that says that there is a specific period of time for that law once initiated-.

[Page 1037]

Q. and these Precautionary Measures are accessory to the merits, -once a definitive Judgment is issued, that Precautionary Measure is lifted, and that asset is returned to the owner or the affected Party or the effects become permanent. But the Precautionary Measure cannot last longer in its effect or beyond the final Judgment. It cannot be effective after that Judgment. -Do we agree on that?

A. Yes.

Q. Peruvian law, in the criminal procedure law and the criminal Procedural Code, established, both establish a maximum duration for a Criminal Proceeding. "Yes" or "no"?

A. Yes.

Q. So, a Precautionary Measure, according to Peruvian legislation, cannot last longer than the period of time for the proceedings that the Peruvian Constitution says based on the Criminal Procedural Codes.

A. I would say that I agree with you. On what we said earlier, the effect can last as long as the proceedings last.

[Page 1038]

Q: Correct.

A: But the second conclusion with respect to if that process has a duration of X, then the Precautionary Measure has to last that period of time as well, I don't find that in the law, and I don't share your point of view.

Q. Yes, but you said that that definitive judgment --causes the Precautionary Measure to cease.

A. Yes, indeed.

Q. And you also said that the Criminal Procedural Code and the Criminal Code establish a maximum duration for the proceeding? "Yes" or "no"?

A. Yes, indeed.

Q. Thank you.

Then, regarding the duration of the investigations or of the seizures and the proceedings that have been conducted against Kaloti's four Suppliers, where we established that Kaloti was not a party and was not notified so it could make use of its right to appeal, it was said that these proceedings were confidential. So, we understand that, under Peruvian law, Kaloti had no access to those records

[Page 1039]

because they were not a party. We do not understand how can a company fight something if it doesn't know its contents, but, that's a separate matter.

Q. But in any case, your Exhibit JM-0042, it is an Excel Table. It's a spreadsheet. You conducted a field investigation for this; correct?

A. -Can- I explain the contents of that document?

Q. Yes.

A. Thank you.

In principle, this spreadsheet was because we wanted to show that Criminal Proceedings can last longer than the periods of time established in the law, and that can be seen by doing a practical comparison.

Secondly, if you see, all the records are from the Third Appeals Chamber, and it's also an enforcement Chamber.

We are talking about a chamber that is called more of a liquidating chamber.

And what does that mean? You, yourself, had talked about the Procedural Criminal Code and The Code

[Page 1040]

of Criminal Procedures. Dr. Caro also referred to the new Code and the old Code, so these are cases that are under the old Code. They have remained in progress, and they are still within the scope of the older Code.

So, the coincidence, the overlap that I find here is trying to show that, in that same Chamber, where those proceedings on the Kaloti Suppliers are being dealt with, there are other Criminal Proceedings where we can see on the record also have been going on for some years.

Now, if I may anticipate your question,

Q: Sure.

A: when you talk about fieldwork, are you going to ask me what kind of case each was,? Was it homicide or theft? I'm going to say, no, this was a reference I got from the information service of the Judicial Branch regarding cases.

But what I can say, Doctor -and I think all of us here would agree- -is that a money- laundering case is very complex; and, as such, the investigations sometimes have to be extended. Those periods of time have to be extended. Those -money laundering cases

[Page 1041]

are more complex probably than the ones we're- looking at here.

And to conclude my answer, and thank you for letting me explain this, we have to think about the context, the place where we are. You said you have been in Perú. We're talking about Callao, and there is not just the airport, there is the port, so the number of cases that can be initiated as a consequence of potential activities of this case is a lot. It's a city where there is a lot happening, and I think this is a true, a real reflection of the existence that we cannot doubt of Criminal Proceedings in my country where there is a temporal overlap with what we are discussing now.

Q. Are you done?

A. Yes.

Q. Thank you.

You said the Code of Criminal Procedures, I think it's from 1939 --is the one that is applied to these cases?

A. Yes, I agree.

Q. So, we can conclude that these cases have

[Page 1042]

had a longer duration than what is established in terms of duration by the Code of Criminal Procedures of 1939?

A. That's correct.

Q. So, what happens in practice in these courts does not modify what the law says.

A. Correct.

Q. How many of the proceedings against Kaloti's Suppliers are in the oral trial phase? I think you said one.

A. Yes, one. To date, there is one where there is a formal accusation already. This means that they're going to go on to an oral trial, according to the information I have -I'm- sorry.

Q. Thank you.

A: To date, from the reports, I see there were two others that were in a transitional period toward trial, and there is one more that is still being analyzed and the Decision needs to be made about whether there will a formal accusation or a dismissal.

Q: So, to sum up, only one of those four is in that phase going toward the oral trial?

[Page 1043]

A. Yes.

Q. And all the ones on this spreadsheet are in that phase, oral trial.

A. From what we can see in the first group that says "continuation of oral trial," - it is evident that they are in oral trial. The ones that say "hearing of the case", that could be an appeal or an oral-a report requested by counsel.

Q. That comes after the oral trial?

A. Not necessarily. It can be--have something to do with appeal or have something be a consequence of a judgment.

Q. And that's after the oral trial.

A. Correct.

Q. So, as a minimum, other ones that say "Continuación JO" are more advanced than three of the investigations against the four Suppliers; correct?

A. Correct.

Q. And you said, just to clarify, that you don't know whether these are money laundering cases.

A. No.

Q. You don't know.

[Page 1044]

A. No, my reference has been, as I said, based on the Chamber of the Court and based on the record so we could link them to the years.

Q. So total, you had access -between this exhibit- and others, I understand, access to 160 cases?

A. As I said, this is public information, you can obtain it by entering the website of the judicial branch.

Q. But these cases that you included are approximately 160?

A. I haven't counted them, but it's all the ones that you see there.

Q. Well, we did add them up, and we got 160.

A. Yes, I have no problem with it. Maybe three more, but around there.

Q. How many cases per year are decided in this jurisdiction of el Callao?

A. That's not information I have.

Q. Would it surprise you if I told you it's over 3,000?

A. When you tell me that these cases are

[Page 1045]

decided, are you telling me a final decision is made or they are in progress?

Q. It includes both things.

A. Well, that is my point. What I'm not surprised by is the burden that--

Q. I'm sorry, just to correct what I said. I was referring to the number of cases that enter into the system every year.

Would it surprise you or would it sound unreasonable to you if I told you that just in this specific jurisdiction it's 3,500? As far as we understood, it's over 20,000 in the entire country, almost 30,000 per year. Does that sound reasonable to you or not?

A. I will be honest, I'm speculating, 3,000, 2,000, 5,000, what doesn't surprise me is that high burden on the judicial system. What we do agree on is that it is a very heavy load for our judges.

Q. Maybe they're very busy and that's why they can't fulfill or complete the processes within the periods established by law. Is that what you're saying?

[Page 1046]

A. No. What I'm saying is that it's a high burden, whether it's 2,000, 3,000, 5,000. I don't know, I don't have that information.

Q. But let's assume ---well, you also said 3,500 just in this jurisdiction doesn't- seem strange to you?

A. I'm not surprised by the number of cases, the volume of cases in these jurisdictions in Perú. It's a high load.

Q. What I'm talking about is about the statistical significance of this sample. If I'm correct, 160 cases out of 3,500-and that's not the cases that are pending, that's the approximate number of cases that enter through this jurisdiction in one year. And, in Perú, as far as we understand- -and I'm not asking you to confirm what I'm saying, but I'm simply saying that we understand that it is at least 25,000 per year in all of Perú. And this is one of the jurisdictions, I understand, that the one with the heaviest burden of cases is the Lima jurisdiction-.

So, can we draw any conclusions out of this very small sample, is what I'm concerned about. In

[Page 1047]

almost all the records you cite -first of all, we don't know if they're about money- laundering, and second, as we know, most of them are further along than three of the four cases that involve Kaloti's shipments. That was my point. I don't know if you would like to make a comment, and if you don't want to, that's- fine.

A. No.

Q. Okay. Thank you very much.

I think we have only two more questions and we will conclude.

You conducted an analysis of the indicia referred to in the orders to start the proceedings and the resolutions as well, where the seizures were determined. There were at least, that we know of, five seizures. There was a discussion as to the fifth shipment and whether that seizure is still effective and how long it lasted.

But my question is: All those clues, all those indications which are in the record, in and of themselves, are they enough for a conviction, a decision to convict on money laundering charges?

[Page 1048]

A. Let's me see, I may. We discussed this a few minutes ago, and the parameters vary as the process moves forward.

Q: Yes.

A: If the indicia are not confirmed, if they are dismissed, then there wouldn't even be a formal accusation. There would be request to dismiss.

As these indications are confirmed or as new elements of evidence come up -I'm talking in general terms--then- the case becomes more solid for the Prosecutor; and, based on that, that Prosecutor's formal accusation can be filed.

If you're asking me just about this case, or actually-- Q. In general terms. In general terms with those first indications that arrive in the beginning of a criminal proceeding, based just on that, is a person going to be convicted, I would say it's not likely. But that is why everything is developed. It's a whole process where evidence is collected, and the Parties also submit evidence, and that's when we can confirm or not confirm

[Page 1049]

criminal liabilities.

Out of the accusations that I have been able to review, could these have, as a result, a conviction as Dr. Caro said? I don't have a crystal ball, but my experience would lead me to think that the answer would be yes.

Q. Are you done?

A. Yes, sir.

Q. Let me ask you in a different way to see if we can agree.

I understand that you're saying that the files, in general, these cases can lead to a definitive conviction against the Suppliers, not against Kaloti?

A. Yes.

Q. Because it's the four Suppliers, and this we've discussed, it's the four Suppliers who are the subject of these proceedings. You are not going to convict someone who is not part of the proceeding.

Q: So, you are issuing an opinion regarding what you think is going to happen with these cases which leads you to believe that, with what comes

[Page 1050]

later, there might be a conviction?

A. If I may, with all due respect--

Q. And it's reciprocal, it's mutual.

A. Thank you very much.

I understand that you, with your experience as a lawyer, can look at a case and foresee what the outcome might be. We're talking about general terms, but neither you nor I are the Judge who is going to issue the Final Decision.

But what I'm saying and what I confirm now is that, based on my reading of the Prosecutor's accusations and my Expert Opinion, I believe there is a high likelihood of a conviction in these cases.

Q. Understood. I will not argue on that answer, which is your personal answer.

Let me ask you another question: If nothing further happens with these cases, only these indicia which were the trigger for the initiation of the investigations, those that were documented and were submitted as evidence for this Arbitration, in and of themselves, are they enough for a conviction?

A. Well, let's see. I'm going to repeat what I

[Page 1051]

said earlier. Please don't take this the wrong way, but you're talking about indications or indicia, and I have just given my presentation, and I said a few minutes ago that these indications need to be reinforced, and in due time we will be talking about evidence and not just indicia. If you -ask me whether the evidence that's in the Arbitration according to my point of view can have as an outcome a conviction? my answer is yes. But if you ask me if it's just with the clues just with the indications as with any Criminal Proceeding, am I going to convict based just on what we have the first day? -No.

So, that's why we have to be very careful with that term "indicia" because that can lead us to the response that you want, and I thank you for allowing me to expand on this because it's one thing to have an initial suspicion and indication, and it's another thing to have all the evidence that you can compile throughout the whole process.

So, I reiterate my response that: The evidence that we have support for the Prosecutor's accusation generate a pretty high likelihood of

[Page 1052]

conviction.

Q. But all the evidence that we have in the documents in this Arbitration are only indicia.

A. No, they're not just indicia. They're elements. They are elements of proof that have allowed the Prosecutor to file an accusation, and that's a very serious matter.

It's one thing if a prosecutor decides to investigate a person. Evidence is going to be taken, and it's different when that prosecutor decides to file an accusation. He's not investigating anymore.

Now, I'm going to say it in very simple terms that if that's the case that all that evidence is there, that person needs to go to the jail, and that's a sanction, that's a punishment and being deprived of freedom. Maybe it can be suspended, that's another thing. But I want to be very clear on this.

If you insist on using the word "indicia," what I'm saying is that we need evidence. The indicia are the starting point, but then those suspicions, those indicia, are confirmed as the process continues.

[Page 1053]

I don't know if we have been able to look at the accusation of a prosecutor, but when the prosecutor files that accusation, he doesn't say I'm presenting indicia, he says I'm presenting evidence. Then that's a higher standard that lead him and that those requirements were met to the level that that person decided to file that accusation.

Q. In terms of what we have in the record for this Arbitration, have you seen any evidence -and- I understand what you are saying is your point of view in terms of what the Prosecutor needs to have in his hands, but in terms of what is in this Arbitration, is there any evidence beyond indicia for any of the four proceedings?

A. I want to find the exhibit.

What causes me to speculate -and I underline that word "speculate"- -that these proceedings have a high likelihood of leading to a conviction, the Prosecutor's accusations that you see, and based on which I'm giving you my answer. If you ask me where do I see that evidence in the record, precisely there, with those prosecutor's accusations. There is another

[Page 1054]

one, R---212, there are others that are also in the record.

Q. I personally have not seen in the record of this Arbitration anything that hasn't been described as "indicia" but we're not going to argue that because what's in the record is in the record. At least we can agree that, after that indictment or accusation, the right to the defense of the four accused Parties begins, and they can submit evidence in their defense, and that is not in the record yet, and that's why you haven't seen it.

A. The right to defense starts when -the person is arrested or cited by the authority. That's when it starts, so their right to defend themselves does not begin on the first day of the oral trial or in the cases that are already in that phase or when it's- being decided. It starts on the first day.

The investigation is a stage that looks for collecting evidence. At that time, the Parties should provide sufficient evidence. This is their evidence.

If during the proceedings new evidence arises, well, the Parties are going

[Page 1055]

to be able to contribute that evidence, but the right of defense begins not when you are accused. It begins before. They have the right to defend the four providers from the first day that everything started.

Q. Now, the taking of evidence during a proceeding for the accused, when does that happen?

A. Well, the weighing of the evidence is during the trial, but the presentation of the evidence can come at the investigation stage. When you used the phrase "right of defense"--

Q. Excuse me for the confusion. I thought you told me that the case files were initially under seal, not even the investigated Party has access to it.

A. No. The investigated Party does have access to them. They're under seal for the Parties.

Q: When are they confidential?

A: The term "confidential" could be linked to secrecy when a judicial resolution is issued in that sense to carry out certain proceedings so that people do not become aware of what is happening within the

[Page 1056]

investigation. Which I have not observed in this case.

Q. When is it that the investigated Party have access to that?

A. Well, when a decision is issued by the Judge to take certain procedural steps. The idea, of course, is for people not to have--

Q. The individuals that have no knowledge of the case, could those also be the investigated Parties?

A. Well, in general, yes, but I haven't seen those Measures here.

Q. Okay. We're going to get to that.

The accused, -I don't remember who the accused were now; the four investigated Parties, let's just say- -they still have the right to submit- new evidence; right?

A. Yes.

Q. You cannot assess those pieces of evidence because you don't know those pieces of evidence. You don't know what they are?

A. Right. But when you mention the fact that

[Page 1057]

they would only have the right of defense at a certain point, that may lead to confusion.

Q. No, I think that was clarified. They can submit evident on file, and they can bring additional documents?

A. Yes, they can do that.

They have had no limitations, Mr. Díaz-Candia. This happens in all Criminal Proceedings when you have an accused individual.

Q. I have a couple more questions.

In Peruvian civil law-and I understand that you're not an expert on civil law, but my question is very basic, it relates to law in general in Perú- -are- oral contracts allowed?

A. Yes.

Q. Are there cases where you need to have a piece of paper called "Contract" signed by both Parties and perhaps it has to be filed with a registry, for example, in the purchase and sale of Real Property? That's a regular in many countries.

A. Agreed.

Q. But if the law does not specifically provide

[Page 1058]

for formalities in a contract, a contract may be entered into orally -right?- --without any kind of document.

A. Agreed.

Q. Even when you are seeking for evidence in a contract. For example, the delivery of the asset, the payment of the price, an invoice, those can be pieces of evidence for a contract?

A. Yes.

When you talk about evidence in general terms, not only for contracts, the evidence needs to create conviction. It has to get to that parameter.

Q. Do you know if the five gold shipments investigated in this case were delivered to Kaloti at the offices that Kaloti had in Hermes?

A. I'm not sure whether they were delivered to Kaloti. That's not clear in my mind.

Q. If they had been delivered to Kaloti in Hermes, that would be a potential evidence of the existence of a contract?

A. I would be speculating. I don't know. That is not clear in my mind. I've reviewed the documents,

[Page 1059]

but it's not clear in my mind.

Q. But, in basic civil law, the delivery of the asset is that an element that evidences the existence of a contract?

A. Yes, it may be one of the elements that prove the existence of a contract.

Q. Thank you. Thank you very much for your patience, Mr. Missiego.

A. You're welcome.

MR. DÍAZ-CANDIA: That finishes the cross-examination. Thank you.

PRESIDENT MCRAE: Thank you. Do you have redirect?

MR. GRANÉ LABAT: No, Mr. President. Thank you.

PRESIDENT MCRAE: Thank you. Questions?

QUESTIONS FROM THE TRIBUNAL

ARBITRATOR FERNÁNDEZ: I do have a question. It's a very specific question related to Peruvian law. You stated that Kaloti submitted three pleadings in the Criminal Court in the case of [Redacted] [Redacted], but none of those pleadings met the

[Page 1060]

substantial and formal requirements to have Kaloti appeal; is that true? You talked about "practice" in your statement. Could you please indicate what procedural provisions are there that support your statements?

THE WITNESS: Let us see. In principle, I would look at the evidentiary aspect of things. I don't remember the provision but generally.

In the case of Kaloti and in any specific case, when you go to a court and you are claiming a certain right, I think that when you have a standard, what you need to do is to evidence your right. What I was able to see out of the pleadings that I've reviewed and that were filed with the judiciary and that were shown this morning to Claimant's Expert, well, those pleadings indicate that Kaloti asks for the return of the gold, but it does not attach to those pleadings evidence that shows Kaloti's status as an Owner.

In two of those cases, more than speaking about a property right or trying to evidence the property right, they don't do that. What they say is,

[Page 1061]

well, if the Request is not granted, what they're going to do, they say, is submit the case to arbitration. If I want to evidence that I am the Owner of something, the least I have to do is show documents evidencing my ownership. That is what I was referencing when I made my statements. And I think your question is in that connection.

ARBITRATOR FERNÁNDEZ: Okay. If we have provisions before us, so perhaps we can cure these deficiencies; right?

THE WITNESS: In my expert opinion, I think that Kaloti could have filed a new pleading supported by evidence showing the ownership it claimed it had. The fact that the request was not granted, give me my property back, well, that would have caused Kaloti to maybe issue a new pleading or file a new pleading.

And also the amparo, they could have filed an amparo. An amparo, of course, entails the exhaustion of other remedies.

Kaloti may understand that the possibility of going to the general courts has been exhausted, and then you could ask for an amparo. You can file an

[Page 1062]

amparo under the Constitution. There is no obligation to do it, they said here. But, for us lawyers, well, we don't have an obligation to submit something. But, if I want to have a favorable result when I lodge a claim, I need to be diligent, I need to file documents. I cannot say, since I have no obligation, I will submit nothing.

ARBITRATOR FERNÁNDEZ: Okay. Thank you very much.

THE WITNESS: You're welcome.

PRESIDENT MCRAE: Thank you very much, Mr. Missiego. We appreciate your testimony, that you've given your testimony today, and there are no further questions, and you're now relieved from your obligations as a witness.

(Witness steps down.)

PRESIDENT MCRAE: That brings us to the end of today's--

MR. DÍAZ-CANDIA: Mr. President, a very minor issue with your permission.

PRESIDENT MCRAE: I beg your pardon?

MR. DÍAZ-CANDIA: A very minor issue with

[Page 1063]

your permission.

PRESIDENT MCRAE: I was going to ask if there's anything procedurally to be raised. I know there's one issue that's going to be raised by the--

MR. DÍAZ-CANDIA: At minute 14:45:10 of the Transcript in English, "juicio" was translated as "adjudication."

REALTIME STENOGRAPHER: Can you say that again, please?

MR. DÍAZ-CANDIA: At minute 14:45:10 of the English Transcript, I understand that "juicio" was translated that there has been an "adjudication," and we believe that's not correct. If you can take a look or if not, we can deal with it when we are revising the--when we propose the corrections to the Transcript. Just to make the point now, if it's easier.

That's it.

PRESIDENT MCRAE: So, you want to correct the Transcript at the point?

MR. DÍAZ-CANDIA: We would invite the Court Reporter to look again at that and decide if he

[Page 1064]

1 believes that the--it's probably more an issue for the

2 Translator than you, but we invite them to confirm

3 that. If not, we will deal with that when we propose

4 corrections to the Transcript.

5 PRESIDENT MCRAE: Right. Thank you. I

6 assume Respondent has no problem with that issue.

7 And that's your one issue? So, we move to

8 the Respondent--you're free to go now, if you'd like.

9 I'm sorry, we shouldn't make you continue to sit and

10 listen to this.

11 So, now I give the floor to the Respondent.

12 Could you describe precisely what the issue is and

13 what you want to be done.

14 MR. GRANÉ LABAT: Thank you very much,

15 Mr. President.

16 During the cross-examination, at the

17 beginning of the cross-examination, we asked Mr. Caro

18 Coría whether he had participated in other ICSID

19 arbitrations, and he admitted that he did. We

20 proceeded to point out which arbitration that was.

21 It's Enegás v. Perú. He admitted that he had

22 participated in a Hearing that took place in this very

[Page 1065]

1 same room, and that happened in September of last

2 year.

3 However, Mr. Caro Coría refused to admit

4 that he participated as counsel for Claimant. And

5 that, in the light of that assertion, we are

6 requesting a leave to submit the List of Participants

7 to that Hearing which lists Mr. Caro Coría as counsel

8 for Claimant in that ongoing arbitration. That is our

9 request. Now, that was the point that we indicated

10 before we started.

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10 PRESIDENT MCRAE: If I understand correctly,

11 before I ask for a comment from the Claimant, if I

12 understand correctly you're asking for permission to

13 submit that document and you're reserving your rights?

14 MR. GRANÉ LABAT: That's correct[Redacted]

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19 Mr. Díaz-Candia?

20 MR. DÍAZ-CANDIA: Thank you, Mr. President.

21 With respect to Mr. Grané's procedure, we

22 have no objection on him submitting the List of

[Page 1067]

1 Attendees to that Hearing as long as after that

2 submission we are given an opportunity to respond.

3 So, we're basically saying that, in our view, he

4 doesn't need the leave from the Tribunal. He as oral

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6 respond to that submission after it is made.

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11 PRESIDENT MCRAE: Is there anything further?

12 So, that brings us to a close for the day.

13 Tomorrow morning it's 9:00 again for the Experts on

14 quantum. If there's no problem with that, we'll start

15 at 9:00 with those Experts. Thank you.

16 (Whereupon, at 5:23 p.m., the Hearing was

17 adjourned until 9:00 a.m. the following day.)

[Page 1074]

POST-HEARING REVISIONS

CERTIFICATE OF REPORTER

I, David A. Kasdan, RDR-CRR, Court Reporter,

do hereby attest that the foregoing English-

speaking proceedings, after agreed-upon

revisions submitted to me by the Parties, were

revised and re-submitted to the Parties per

their instructions.

I further certify that I am neither counsel

for, related to, nor employed by any of the

Parties to this action in this proceeding, nor

financially or otherwise interested in the

outcome of this litigation.

Signature

DAVID A. KASDAN