This HTML version is machine-generated. Always consult the original document.

INTERNATIONAL CENTRE FOR SETTLEMENT OF INVESTMENT DISPUTES

Veolia Propreté SAS

v.

Italian Republic

(ICSID Case No. ARB/18/20)

PROCEDURAL ORDER NO. 5

Hearing Organization

Members of the Tribunal

Prof. Eduardo Zuleta, President of the Tribunal

Ms. Judith Gill, KC, Arbitrator

Prof. Laurence Boisson de Chazournes, Arbitrator

Secretary of the Tribunal

Ms. Natalí Sequeira

22 Abril 2023

[Page 2]

I. PROCEDURAL BACKGROUND

1. Pursuant to Section 19.1 of Procedural Order No. 1 and Annex B of Procedural Order No. 1, a pre-hearing organizational meeting between the parties and the Tribunal was held by videoconference on 13 April 2023 (the “Pre-Hearing Conference”), to discuss any outstanding procedural, administrative, and logistical matters in preparation for the Hearing. Participating were:

Members of the Tribunal:

Prof. Eduardo Zuleta, President of the Tribunal

Ms. Judith Gill, KC, Arbitrator

Prof. Laurence Boisson de Chazournes, Arbitrator

ICSID Secretariat:

Ms. Natalí Sequeira, Secretary of the Tribunal

Ms. Anastasia Tsimberlidis, Paralegal

Ms. Bernarda Muriel Bedoya, Intern

On behalf of the Claimant:

Mr. Dany Khayat, Mayer Brown

Mr. Jawad Ahmad, Mayer Brown

Ms. Nawal Jallabi, Mayer Brown

Mr. Aslan Boucobza, Mayer Brown

Mr. Vincenzo Bozzetto, Veolia Environnement

On behalf of the Respondent:

Avv. Pietro Garofoli, Avvocatura dello Stato

Avv. Laura Delbono, Avvocatura dello Stato

Dott. Elio Cucchiara, Avvocatura dello Stato

Dott. Gaia Iappelli, Avvocatura dello Stato

Dott. Adele Berti Suman, Avvocatura dello Stato

[Page 3]

Prof.ssa Maria Chiara Malaguti, Minister of Foreign Affairs Consultant

Prof.ssa Ludovica Chiussi Curzi, Avvocatura dello Stato Consultant

2. During the Pre-Hearing Conference, the parties and the Tribunal discussed the draft Procedural Order circulated to the parties on 28 March 2023, and the parties' joint statement of 11 April 2023 advising the Tribunal of any agreements reached on the various items, their respective positions where no agreement was reached and the parties' proposed daily schedule.

3. A recording of the Pre-Hearing Conference was made and uploaded to the BOX account for this case, and it was made available to the Members of the Tribunal and the parties on 22 April 2023.

4. The Tribunal has considered the parties' positions and, in the present Order, sets out the procedural rules that the parties have agreed upon and/or the Tribunal has determined will govern the conduct of the Hearing.

II. ORGANIZATION OF THE HEARING

A. DATE AND FORMAT OF THE HEARING

5. The Hearing will take place in person at the facilities of the Corte de Arbitraje de Madrid (Madrid Court of Arbitration) located at the Palacio de Santoña, Calle Huertas 13, 28012 Madrid, Spain.

6. The hearing is scheduled to run over five days from 15–19 May 2023.

B. ORDER OF PROCEEDINGS AND SCHEDULE

7. The Hearing will start each day at 09:00 and will conclude by 17:30 (Madrid time). There will be two coffee breaks of 15 minutes each (one in the morning and one in the afternoon), and a lunch break of 1 hour each day.

[Page 4]

8. The parties were invited to prepare a proposed daily schedule or to submit their individual proposals, absent an agreement between them. The daily schedule agreed by the parties is included in this procedural order as Annex A.

9. The Hearing Schedule established in Annex A shall be subject to any such modification as the Tribunal may deem necessary or appropriate in the course of the Hearing, in particular, on account of any delay or interruption due to technical difficulties. If any segment of the time allocated in the Hearing Schedule proves not to be needed, the parties shall be prepared to move promptly on to the next item in the Schedule. If moving to the next item in the Schedule results in a witness or expert testimony being spread over two days, the Tribunal, in consultation with the parties, will decide whether to extend the hearing day or authorize the cross-examination to be spread over two days. In the latter scenario, the witness or expert will remain sequestered until their testimony is completed.

10. The Hearing will proceed on the principle of equal allocation of time between the parties within the time agreed upon for each stage of the Hearing (e.g. Opening Statement, Examination of Witnesses and Experts), as indicated in Section 20.4 of Procedural Order No. 1.

11. Considering the start and end times, each Hearing day shall comprise a total of 8 hours and 30 minutes. A total of 1 hour and 30 minutes a day shall be reserved for breaks (including lunch break). Thus, excluding the time reserved for breaks, there will be a total of 7 hours of working time in each Hearing day, out of which 1 hour a day will be reserved for housekeeping matters and Tribunal questions. The remaining time in a day i.e. 6 hours will be available for use by the parties. Accordingly, considering the total number of Hearing days (5 days), each Party will have a total of 30 hours.

12. Time used by the parties in oral argument or in the examination of witnesses and experts shall be attributable to the Party making such argument or conducting such examination. Time spent on housekeeping matters shall not be counted toward either Party's time

[Page 5]

allocation. Questions from the Tribunal and the parties' answers will be counted against the Tribunal's time.

13. Each Party shall use the time allocated to it as deems fit, subject to the following:

1. Opening Statement. Each Party shall be allowed a maximum of 3 hours for its Opening Statement. There shall be no Rebuttal Opening Statements.
2. Direct Examination of Fact Witnesses. There will be no direct examination of a fact witness except when required to address any errors or issues arising after the filing of the witness statement. The direct examination of a fact witness shall not exceed 10 minutes.
3. Direct Presentations by Experts. The direct examination of an expert witness shall not exceed 30 minutes. The Tribunal may authorize an expert to make an oral presentation instead of a direct examination.

14. The Secretary of the Tribunal will keep the hearing time using the chess-clock method and report the time used after each day of the Hearing.

C. DOCUMENTS FOR USE AT THE HEARING

1. Electronic Hearing Bundle

15. There shall be a single Electronic Hearing Bundle (PC and Mac compatible), to be prepared jointly by the parties, which shall be uploaded by the parties to a designated sub-folder in a filesharing platform no later than 5 May 2023.

16. The Electronic Hearing Bundle which shall contain all pleadings, expert reports, exhibits, legal authorities and Tribunal's orders or decisions on file to date, with a consolidated hyperlinked index. It shall not contain any document not previously filed. It shall be organized as follows:

[Page 6]

01. Pleadings

A. Claimant

B. Respondent

02. Witness Statements

A. Claimant

B. Respondent

03. Expert Reports

A. Claimant

B. Respondent

04. Exhibits

A. Claimant

B. Respondent

05. Legal Authorities

A. Claimant

B. Respondent

06. Tribunal's Rulings and Procedural Orders

07. Correspondence

17. To ensure operation of the hyperlinked index, the entire Electronic Hearing Bundle shall be housed within one folder and then uploaded to Box as a single zip file. Should the size of the zip file make the upload to Box not possible, the parties shall upload the organized Electronic Hearing Bundle to a designated folder on to Box organized in sub-folder using the structure indicated at paragraph 16 supra and including a consolidated hyperlinked index. The parties will also prepare a second hyperlinked index of both parties combined factual exhibits in chronological order.

18. To the extent possible, all materials in the Electronic Hearing Bundle shall be text searchable (i.e., OCR PDF or Word), and should include a table of contents where applicable.

19. The court reporters and the interpreters will also be provided a copy of the Electronic Hearing Bundle via Box.

[Page 7]

20. In addition, the parties shall distribute the Electronic Hearing Bundle (including the consolidated hyperlinked index) in a USB at the onset of the Hearing to: (i) Tribunal (3 copies)¹; (ii) the Secretary of the Tribunal (1 copy); (iii) court reporters (2 copies) and (iii) interpreters (3 copies).

21. The Parties are encouraged to facilitate a hard copy of their speaking notes and presentations to the interpreters and stenographers a few minutes before each presentation to facilitate the proper provision of these services. The presentations or notes will be provided only to the interpreters and stenographers who may not distribute them to any other person and shall treat them as strictly confidential. The speaking notes and presentations will be kept strictly confidential and destroyed after use.

22. At the conclusion of the written and oral submissions, the parties shall update the Electronic Hearing Bundle to include, for example, hearing demonstratives and any post-hearing submission, and also provide an updated consolidated and hyperlinked index.

2. Electronic Hearing Bundle for Cross-Examination

23. At the beginning of each witness or expert direct examination, the Party who is putting forward the witness or expert will provide the witness or expert with hard copies of his or her signed statements or reports.

24. During cross-examination, the parties will only refer to documents that already form part of the record of the case, using the Electronic Hearing Bundle.

25. The witness and experts are entitled to be shown a full copy of any exhibit or authority on which they will be questioned (i.e., they are not to be restricted to reviewing excerpts of documents shown on a screen).

¹ Prof. Boisson de Chazournes would appreciate receiving a USB with a copy of the entire case file, eight days prior to the hearing.

[Page 8]

3. Demonstrative Exhibits

26. The parties may use PowerPoint or other slide presentations for their oral statements, subject to the below rule on demonstrative exhibits. Documents that do not form part of the record may not be presented at the Hearing. Pursuant to Sections 11.1 – 11.3 of Procedural Order No. 1, the parties will be allowed to refer to documents on the record in a language other than English, provided that they have been accompanied by the corresponding translation. If a party intends to use sections of a document on record that has been translated only in part, such party shall circulate the corresponding English translation of the section it intends to use at least 24 hours in advance.

27. Demonstrative exhibits shall be used in accordance with Section 16.8 of Procedural Order No. 1 (reproduced below):

“16.8. Demonstrative exhibits (such as PowerPoint slides, charts, tabulations, etc.) may be used at any hearing, provided they contain no new evidence. Each party shall number its demonstrative exhibits consecutively, and indicate on each demonstrative exhibit the number of the document(s) from which it is derived. The party submitting such exhibits shall provide them in electronic and hard copy to the other party, the Tribunal Members, the Tribunal Secretary, the court reporter(s) and interpreter(s) at the hearing at a time to be decided at the pre-hearing organizational meeting.”

28. An electronic copy of each demonstrative exhibit shall be distributed by the Party intending to use it via an electronic mail sent to the entire case email distribution including the other Party, the Secretary of the Tribunal, the Members of the Tribunal, the court reporters and the interpreters as necessary no later than 1 hour prior to its use, in order to facilitate offline access to the demonstrative exhibits by the Hearing Participants. Hard copies of the demonstrative exhibits shall be provided to Prof. Laurence Boisson de Chazournes, with the same anticipation.

[Page 9]

29. Promptly after the conclusion of the Hearing day in which a demonstrative exhibit has been used, the parties will upload the used demonstrative exhibit to Box designating each with the corresponding CD-__ or RD-__ number.

D. WITNESS AND EXPERT EXAMINATION

30. The parties provided notice of the witnesses and experts to be examined in the Hearing on 21 March 2023.

31. The examination and cross-examination will proceed in accordance with Sections 18.5-18.7 of Procedural Order No. 1, which reads as follows:

18.5. Witnesses and experts shall be examined by each party under the control of the Tribunal. Before giving evidence, witnesses shall make the declaration set out in ICSID Arbitration Rule 35(2), and experts shall make the declaration set out in ICSID Arbitration Rule 35(3). The Tribunal may examine the witness or expert at any time during the scheduled oral examination of said witness or expert

18.6. The time, form and order of the direct examination, cross-examination, and any re-direct examinations shall be discussed and agreed on by the parties at the Pre-Hearing Organizational Meeting set out in Annex B.

18.7. Fact witnesses shall not be allowed in the hearing room until they are giving their oral evidence. However, if a fact witness is also a representative of one party, such fact witness shall be called to testify first (this applies to both Claimant and Respondent) and shall be allowed to stay in the hearing room. Expert witnesses shall be allowed in the hearing room at any time.

[Page 10]

32. Fact witnesses produced by the Claimant shall be crossed-examined first, followed by fact witnesses produced by the Respondent. Experts shall then testify individually. Experts produced by the Claimant shall testify first, followed by experts produced by the Respondent. The party producing each witness shall designate the order in which they will testify. If a fact witness is also a representative of one party, such fact witness will be allowed to be present during the Opening Statements.

33. The Party who has presented the witness may then re-examine the witness with respect to any matters or issues arising out of the cross-examination.

34. The Tribunal may examine the witness at any time, either before, during or after examination by one of the parties; and may direct that the experts are examined concurrently (expert conferencing).

35. The Tribunal shall, at all times, have complete control over the procedure for hearing a witness and/or an expert.

36. The Respondent has called the following witnesses and experts produced by the Claimant:

Witnesses

0.1.Mr. Jean-Marc Janailhac [French-English interpretation]

0.2. Mr. Bruno Masson [French-English interpretation]

0.3. Mr. Vincenzo Bozzetto [Italian-English interpretation]

Experts

0.1.Mr. Anthony Theau-Laurent and/or Mr. Christophe Schmit (Accuracy)

[English – no interpretation services required]

37. The Claimant has called the following witnesses and experts produced by the Respondent:

[Page 11]

Witnesses

0.1. Mr. Walter Bresciani Gatti [Italian – English interpretation]

0.2. Mr. Vicenzo De Matteis [Italian – English interpretation]

0.3. Mr. Andrea Adelchi Ottaviano [Italian – English interpretation]

Experts

Prof. Stefano Consonni, Prof. Stefano Pedrini, Prof. Federico Vigano (Politecnico Milano). [Italian – English interpretation]

38. The two experts that prepared the Claimant's Expert Report and the three experts that prepared the Respondent's Expert Report will be simultaneously cross-examined. Before 30 April 2023, the parties must provide to the Tribunal and the other party an index that identifies the subject matter that each expert covered in the Report. The cross-examination of each expert will be focused on his specific subject matter as specified in the index. If there is a question that is not clearly attributed in the index to a particular expert, the experts will confer and agree on which expert should respond. An expert will not be permitted to comment on or complement the answer of the other experts.

39. In order to avoid any delays during the course of the Hearing, witneses and experts shall be available for examination half a hearing day before and after the time at which his/her examination is scheduled. The witness or expert must be at the facilities of the Corte de Arbitraje de Madrid (Madrid Court of Arbitration) where the Hearing will take place, no less than 1 hour before his/her examination to ensure that s/he is available in time to be brought into the Hearing Room.

40. Except for an unannotated copy of his/her witness statement(s)/expert report(s), which will be shown on the screen during the examination, the witness/expert shall not be aided by any other documents, notes or otherwise, unless permitted by the Tribunal upon application by a Party.

[Page 12]

Ε. RECORDING

41. Pursuant to Section 21 of Procedural Order No. 1, sound recordings will be made of the Hearing. There will also be video recordings that will not be made public or become part of the record of this arbitration. However, the video recordings may be used to guide transcript corrections, and once transcript corrections have been completed, the transcript shall serve as the record of the Hearing. The Tribunal also may refer to the video recording, as it deems necessary.

42. The sound and video recordings shall be provided to the parties and the Tribunal at the conclusion of the Hearing.

43. Except for the court reporters that will make their own audio recording of the Hearing, attendees will not otherwise make any audio or video recording of the Hearing or any part of it.

F. TRANSCRIPTS

44. The provisions of Procedural Order No. 1, Sections 21.2 and 21.3 concerning transcripts (reproduced below) apply:

21.2. Verbatim transcript in the procedural language shall be made of any hearing and session other than sessions on procedural issues. Unless otherwise agreed by the parties or ordered by the Tribunal, the verbatim transcripts shall be available in real-time using LiveNote or similar software and electronic transcripts shall be provided to the parties and the Tribunal on a same-day basis.

21.3. The parties shall agree on any corrections to the transcripts within 30 days of the later of the dates of the receipt of the sound recordings and transcripts. The agreed corrections may be entered by the court reporter in the transcripts (“revised transcripts”). The

[Page 13]

Tribunal shall decide upon any disagreement between the parties and any correction adopted by the Tribunal shall be entered by the court reporter in the revised transcripts.

45. ICSID has made arrangements to have English verbatim transcripts available in real-time using Live Note or a similar software during the Hearing.

46. If the court reporters participate remotely, real-time court reporting in English will be provided, and the ICSID Secretariat will send the Hearing Participants the details to access the Real-time transcripts.

47. Electronic versions of the transcripts will be provided to the parties and the Tribunal on a same-day basis.

G. INTERPRETATION

48. The ICSID Secretariat will arrange for interpretation in English, as the procedural language of the arbitration, pursuant to Section 11 of Procedural Order No. 1.

49. Hearing Participants should speak slowly, one person at a time, and should pause briefly when handing the floor to another Hearing Participant.

50. The testimony of Accuracy will be delivered in English only and will not required interpretation services. The testimony of Mr Jean-Marc Janailhac and Mr Bruno Masson will be delivered in French and will be interpreted simultaneously into the English language. The testimony of Mr Bozzetto, Mr Bresciani Gatti, Mr De Matteis, Mr Ottaviano and PoliMi will be delivered in Italian and will be interpreted simultaneously into the English language.

51. Interpreters will attend the Hearing in person.

[Page 14]

H. CLOSING STATEMENT HEARING, POST-HEARING MEMORIALS AND COST STATEMENTS

52. The Tribunal and the parties are to discuss before the conclusion of the Hearing whether to have the Closing Statement Hearing referred to in Section 20 of Procedural Order No. 1, and, in the affirmative, the time and conditions for this hearing. The Tribunal invites the parties to discuss this matter in advance of the last day of the Hearing.

53. The submission of Post-Hearing Memorials and Cost Statements will be defined by the Tribunal and the parties after the Closing Statement Hearing as provided in Section 22 of Procedural Order No. 1. The Tribunal invites the parties to discuss on the timing and format of these submissions and to submit a joint proposal no later than the day before the Closing Statements Hearing.

54. If the Closing Statement Hearing is dispensed with, the Tribunal and the parties will define the timing and format of the submission of Post-Hearing Memorials and Cost Statements.

I. HEARING PARTICIPANTS

55. Each Party shall provide its respective List of Hearing Participants (“List of Participants”) using the format provided in Annex B. Each Party shall designate those participants that will have an active speaking role (“Active Participants”), and those who will be passive attendees ("Passive Participants").

56. Access to the Hearing shall be restricted to those included in the List of Participants. If any non-listed Participant attempts to attend the Hearing, the Secretary of the Tribunal, and the Tribunal, will promptly address the matter with the parties. All Participants in the Hearing bear an ongoing duty to warn of the presence of any non-listed Participant.

J. CONFIDENTIALITY

57. Pursuant to Section 20.5 of Procedural Order No. 1, the hearing shall be closed to the public.

[Page 15]

58. Participants providing services shall (i) keep confidential all documents and information coming to their knowledge as a result of their participation in the Hearing; (ii) not use, or authorize any other person to use, such documents and information other than for the purpose of performing their work at the Hearing; and (iii) dispose of all documents if printed, as confidential material, and delete all electronic copies that might be stored on personal devises when their Hearing-related work has been completed.

For and on behalf of the Tribunal,

Signature

Prof. Eduardo Zuleta

President of the Tribunal

Date: 22 April 2023

[Page 16]

ANNEX A

HEARING SCHEDULE

• Start time 9:00 AM - End time 5:30 PM (Madrid).
• There will be two 15 minutes breaks (approximately every 90-120 minutes), and a 1 hour lunch break each day.
• The Tribunal will reserve 60 minutes each day for questions and housekeeping matters.

Day 1: Monday, 15 May 2023

* Total Tribunal-reserved time not reflected in this indicative agenda.

Day 2: Tuesday, 16 May 2023

² For good order, the timings indicated in the proposed Hearing Schedule are indicative only and are subject to change due to the evolution of the Hearing.

[Page 17]

Day 3: Wednesday, 17 May 2023

Day 4: Thursday, 18 May 2023

[Page 18]

Day 5: Friday, 19 May 2023

[Page 19]

ANNEX B

LIST OF PARTICIPANTS³

TRIBUNAL

³ Use “A” (Active Participants) / “P” (Passive Participants).

[Page 20]

CLAIMANT

[Page 21]

RESPONDENT

[Page 22]

COURT REPORTER

INTERPRETERS