Summary

Reproduced from www.worldbank.org/icsid with permission of ICSID.

TABLE OF CONTENTS

I. INTRODUCTION

II. THE PARTIES

Claimant: Kaloti Metals
Respondent: Peru

III. CLAIMANT'S INVESTMENTS IN PERU

IV. STATEMENT OF FACTS REGARDING PERU'S VIOLATIONS OF THE TPA

Peru's Interim Immobilizations and Seizures of Kaloti Metals' Gold

(i) Purchase No. 1 - Immobilization and Seizure of Gold Purchased by Kaloti Metals from [..]

(ii) Purchase Nos. 2-4 - Immobilization and Seizure of Gold Purchased by Kaloti Metals from [..], [..], and [..]

(iii) Purchase No. 5 - Seizure, Attachment, and Continuing Immobilization of Gold Purchased from [..]

(iv) Peruvian Courts Refuse Petitions to Return the Gold

Consequences of Peru's Actions

V. THE TRIBUNAL HAS JURISDICTION OVER THIS DISPUTE

Ratione Personae: Kaloti Metals is a Protected Investor Under the TPA

Ratione Materiae: Kaloti Metals' Claims Arise Out of its Investments that are Protected by the TPA

Ratione Temporis: Peru and Kaloti Metals have Consented to Arbitration Under the TPA and the ICSID Convention

Kaloti Metals has Fulfilled the TPA's Requirements to Initiate Arbitration

(i) Kaloti Metals has Complied With the TPA's Requirements to Submit its Claims to Arbitratio n After Negotiations with Peru Failed

ICSID has Jurisdiction Over this Dispute

VI. PERU'S BREACHES OF THE TPA

Peru's Progressive and Creeping Expropriation of Kaloti Metals' Investment

Peru Failed to Provide Kaloti Metals with Fair and Equitable Treatment, Protection, Security, and Non-Discriminatory Treatment

(i) Violations of the TPA Consummated on November 30, 2018

(ii) Peru's Inaction After the October 11, 2018 Court Decision

Peru Failed to Provide Kaloti Metals the Same Treatment as Similar Situated Peruvian Nationals or Enterprises

Peru Failed to Negotiate in Good Faith

VII. NUMBER OF ARBITRATORS AND METHOD OF APPOINTMENT

VIII. PLACE OF ARBITRATION

IX. LANGUAGE

X. REQUEST FOR RELIEF

I. INTRODUCTION

1. Kaloti Metals & Logistics, LLC, ("Kaloti Metals" or "Claimant") submits this Request for Arbitration ("Request") to the Secretary-General of the International Centre for Settlement of Investment Disputes ("ICSID") in accordance with Article 36 of the Convention on the Settlement of Investment Disputes Between States and Nationals of Other States (the "ICSID Convention") and the Rules of the International Centre for Settlement of Investment Disputes (the "ICSID Rules").

2. The Request concerns a legal dispute between Kaloti Metals and the Republic of Peru ("Peru" or "Respondent") under Article 10.16 of the United States-Peru Trade Promotion Agreement ("TPA" or "Treaty"),1 with respect to Kaloti Metals' investments in Peru's gold industry.

3. Kaloti Metals is a gold and precious metals company that provided both US- based and Latin America-based customers with complete precious metals solutions, including trading, analyzing, and assaying.

4. Kaloti Metals is a limited liability company incorporated in 2010 in the state of Florida, of the United States of America ("United States"), and had, at all times relevant, substantial business activities (including a physical presence) in the territory of the United States.2 Kaloti Metals is still in good standing under the laws of Florida and the United States but has ceased all business operations. Its founder and only manager is a national (natural person) of the United States

5. The dispute arose from public measures, omissions, and official orders taken by Peruvian authorities, within the country's territory, against Kaloti Metals' properties and assets (i.e., investments) protected under the TPA. The measures taken by Pem include, without limitation, seizures of goods, regulatory harassment, discriminatory measures, undue administrative procedures, violations of due process fights, and a failure to negotiate in good faith. Peru's actions kept Kaloti Metals from its propeny through a progressive and indirect expropriation, and denied them fair and equitable treatment, which consequently deprived Kaloti Metals of basic procedural and substantive rights. Peru's actions consummated into violations ofthe TPA on November 30, 2018, which is the date Kaloti Metals' investments lost all business value as a result of Pem's illegal conduct.

6. Peru's actions include, without limitation, the illegal creeping and progressive expropriation of Kaloti Metals' gold ingots, currently worth more than USD $27

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III. CLAIMANT'S INVESTMENTS IN PERU

12. In 2011, Kaloti Metals began investing in Peru because it was attracted by a rich supply ofprecious metals and by what then appeared to be a favorable investment environment. Its goal was to provide precious metals and related services to customers in the United States and Latin America. Its business included importing and exporting gold to and from the United States and Latin America, as well as providing customers with assaying, or ptu•ity-testing services, to ensure that customers' products met certain quality standards.

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16. As Kaloti Metals' investment in Peru began bearing fruit, Kaloti Metals in turn injected large sums of money into the Peruvian economy. From the time it entered the Peruvian market, and until Peru's breaches of the TPA became actionable, Kaloti Metals successfully operated and conducted a substantial volume of transactions in Peru (until at least July of 2018) involving the purchase and sale of gold from its suppliers.

17. In 2012, only a year after Kaloti Metals initiated operations in Peru, it generated over USD $10 million in sales after purchasing 255.98 kilograms of gold in Peru. The following year, Kaloti Metals significantly expanded its activity in Peru by engaging in over transactions, buying 14,010.8 kilograms of gold from over twenty suppliers, and increasing sales to USD $563 million.

18. In 2013 Kaloti Metals purchased roughly nine percent of the Peru's total annual production of gold, which made Kaloti Metals a key leader in Peru's gold industry.11 This is especially notable considering that Peru is the number one producer of gold in Latin America

19. Notably, none of these over 500 transactions were ever questioned or challenged by Peruvian authorities. The only plausible explanation for Peru's actions is that it did not want a company from the United States (i.e., foreign), such as Kaloti Metals, becoming a key or dominant player in its gold industry.

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IV. STATEMENT OF FACTS REGARDING PERU'S VIOLATIONS OF THE TPA

20. On November 30, 2018, Peru's actions consummated into actionable violations of the TPA, and Kaloti Metals suffered an irreversible loss of its investment and value, which shut down Kaloti Metals' business operations permanently after it was already forced to leave Peru in September 2018.

21. Kaloti Metals' success in the Peruvian gold industry made it an unprovoked target for the Peruvian authorities. As will be described in detail below, Peru initiated actions aimed at temporarily immobilizing and seizing Kaloti Metals' gold, which had been lawfully purchased from its Peruvian suppliers--purchases it made hundreds of times before without incident.

22. Peru also enacted a defamatory and retaliatory campaign to falsely allege that Kaloti Metals was engaged in corrupt practices when it was in fact the Peruvian authorities themselves who were engaged in corrupt practices. Peru has enacted its strategy of seizure and allegations of corruptions against other foreign gold companies operating in Peru as well.

23. Beginning in 2014, despite Kaloti Metals attempts to mitigate the harm caused by Peru's actions, Kaloti Metals' sales started to take a downward spiral until the damage became irreversible. Finally, on November 30, 2018, devastated by Peru's actions, Kaloti Metals was forced to shutter its global operations (having terminated operations in Peru in September of 2018). Therefore, November 30, 2018 is the relevant date when the Peru's breaches of the TPA caused permanent damage and became actionable under Article 10.16 of the TPA

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X. REQUEST FOR RELIEF

109. Kaloti Metals respectfully requests, without limitation and reserving Kaloti Metals' right to supplement or revise these requests for relief, that the Tribunal:

(a) declare that Peru breached Articles 10.3 (national treatment), 10.5 (minimum standard of treatment), 10.7 (expropriation) and 10.15 (affirmative duty to negotiate in good faith) of the TPA; as well as customary international law;85

(b) order Peru to compensate Kaloti Metals for its breaches of the TPA and international law in an amount to be determined at a later stage in these proceedings, plus interest until the date of payment. Kaloti Metals' damages are preliminarily estimated to be USD $75,000,000.00, excluding interests, fees, and costs; this amount is consistent with the damages claimed in Kaloti Metals' notice of intent delivered to Peru on April 8,

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