PERU’S PRELIMINARY OBJECTION UNDER ARTICLE 10.20.4 

The Republic of Peru (“Peru,” “Respondent,” or the “Republic”) hereby submits its Preliminary Objection under Article 10.20.4 of the Peru-United States Trade Promotion Agreement (the “Treaty”) in accordance with the Tribunal’s Decision as to the Scope of the Respondent’s Preliminary Objections under Article 10.20.4 dated 18 December 2014 (“Decision”),1 and the schedule established by the Tribunal in its Procedural Order No. 1 dated 22 August 2013, as modified by agreement of the Parties.2 

I. INTRODUCTION 

1. The Renco Group, Inc. (“Renco” or “Claimant”) seeks an award of unspecified damages for the alleged mistreatment of, and interference with, its alleged investment in Doe Run Peru S.R.LTDA (“DRP”), a Peruvian mining and mineral processing company. In 1997, DRP acquired the smelting and refining complex in La Oroya, Peru (the “La Oroya Facility” or the “Facility”) based upon its specific promises and undertaking of obligations to invest in the development, improvement, modernization, and expansion of the Facility. Critically, it also agreed to comply with an Environmental Remediation and Management Program (“PAMA”) to manage the effluents, emissions, and waste generated by the Facility. Despite multiple extensions of time granted by Peru in good faith, DRP, failed to comply with its specific promises and obligations as required, and ultimately went bankrupt due to its own misrepresentations, mismanagement, and unlawful operations. 

2. Renco now seeks to shift responsibility for its own failures to Peru, arguing, among other things, that Peru “failed to observe its obligations to Renco under the Stock Transfer Agreement and the Guaranty,” which allegedly “were contemplated, prepared and executed as part of a single investment transaction,” and thus qualify as “investment agreements” under the Treaty.3 

3. All of Renco’s claims in this arbitration are factually and legally meritless, and, for the avoidance of any doubt, Peru reserves all of its rights in this regard. For present purposes, in accordance with the Tribunal’s Decision on the Scope of Article 10.20.4, Peru addresses in this submission only certain claims advanced by Renco relating to Peru’s alleged violation of its alleged “investment agreements.”4 As elaborated below, these claims are legally meritless, and should be dismissed at this stage of the arbitration proceedings under Article 10.20.4, so that time, resources, and effort are not expended unnecessarily.