'II. [Claimant]'s motions to exclude

2.1 By letter dated 8 December 2004, [Claimant] raised a number of objections to [Respondent]'s Rejoinder on Claims and Reply to Defence on counterclaims dated 3 December 2004. Some of the concerns . . . were accepted by [Claimant] and are not considered in this Procedural Order. Some of the concerns raised . . ., while resulting in renewed requests from [Claimant] to [Respondent], were not made subject to a formal request by [Claimant] to the Arbitral Tribunal and hence are also not treated in this Procedural Order.

2.2 [Claimant] does however formally seek that certain expert evidence submitted by [Respondent] with its Rejoinder submission be ruled inadmissible in this Arbitration and disregarded. [Claimant] also formally seeks the immediate rejection of two claims made by [Respondent] in the Rejoinder submission.

2.3 By letter dated 14 December 2004, [Respondent] opposes these formal requests by [Claimant] and seeks to have all the expert evidence and claims submitted with or in its Rejoinder submission maintained in the Arbitration. [Respondent] also responds to [Claimant]'s requests noted in paragraph 2.1 above. The Arbitral Tribunal has taken note of each Party's position.

2.4 As to the challenged [Respondent] evidence, [Claimant] specifically objects to the submission of the Expert Report of [A], which it believes contains no rebuttal evidence and hence is filed too late under the terms of the Arbitration Timetable, as revised. [Claimant] also objects to the newly filed Appendices 0 to 9 to [B]'s second Expert Report, which [Claimant] believes constitutes simply backup data for [B]'s findings in their first Expert Report, which was filed with [Respondent]'s Full Defence and Full Brief on Counterclaims of 5 October 2004. [Claimant] complains that the filing of these expert documents only in December 2004 has meant that [Claimant] could not consider and address them in its own Reply on the Claims and Defence on the Counterclaims submitted on 2 November 2004, and that it complicates [Claimant]'s task at this late hour. Since no justification was offered by [Respondent] for such a late submission of these expert documents and since the leave granted by the Arbitral Tribunal for [Respondent] to file late witness statement was limited only to Fact Witness Statements, [Claimant] argues that these expert documents should be struck off the Arbitration Record.

2.5 Understandably, [Respondent] opposes [Claimant]'s request that the [A] Expert Report and the [B] Appendices be struck from the Arbitration Record. The reasons are set forth in [Respondent]'s letter of 14 December 2004. [Respondent] maintains that the [A] Report is in fact a rebuttal report, addressing issues raised for the first time by [Claimant]'s Expert [C] which was submitted with [Claimant]'s submission of 2 November 2004, as well as issues relating to [Respondent]'s counterclaims. [Respondent] maintains also that [B]'s second report and its Appendices constitute rebuttal Expert evidence in answer to the Expert Report from [D] filed by [Claimant] on 2 November 2004. [Respondent] notes that [Claimant] is not prejudiced at all by the Expert's choice of when to file its Appendices and will be able to address questions relating to such documents as it considers irrelevant or otherwise inappropriate in its final submission due on 24 December 2004 as well as to cross-examine the [B] witness at the Hearings. [Respondent] also maintains that for the Arbitral Tribunal to exclude important Expert Evidence of one of the Parties, as [Claimant] now seeks, would prejudice the outcome of the hearing and affect the fair and equal treatment of the Parties.

2.6 The Arbitral Tribunal accepts the arguments of [Respondent] as to these two Expert submissions, and believes that [Claimant] has more than sufficient time to address the contents, including any assumptions, data or expert opinion is set forth in any of the challenged expert documents prior to the Witness Hearings starting at the end of January 2005. Such evidence can also be addressed, as [Claimant] sees fit including arguments as to its relevance and/or correctness, in [Claimant]'s final brief due on 24 December 2004. Hence, the Arbitral Tribunal denies [Claimant]'s request that these documents be stricken from the Arbitration Record.

2.7 As to the challenged [Respondent] claims, it appears that Claim 2(f) constitutes a new claim by [Respondent] submitted for the first time in its 3 December 2004 Rejoinder submission. [Respondent]'s claim 2(i) was asserted previously by [Respondent] in its Full Defence and Full Brief on Counterclaims of 5 October 2004. As to the former, the Arbitral Tribunal refers to Article 19 of the 1998 ICC Rules which precludes a Party from making a new claim or counterclaim falling outside the limits of the Terms of Reference1, unless it has been authorized to do so by the Arbitral Tribunal which, in that regard, shall consider the nature of the new claim or counterclaim, the stage of the arbitration and any other relevant considerations.

2.8 [Respondent]'s claim 2(f) in the Rejoinder submission falls within the defence section of its submission, opposing [Claimant]'s claims based on the Price Revision provisions of . . . It is a claim for a declaration by the Arbitral Tribunal as to facts and the consequences of facts relating to [Claimant's] document of 1 July 2004. While the Arbitral Tribunal has not had the time yet to consider fully [Claimant's] document, the Parties' respective positions as to it, and its consequences in terms of the . . . Price Revision procedures, the Arbitral Tribunal does consider that this [Respondent] claim has been raised early enough in the proceedings for [Claimant] to have sufficient time to respond to it, both in its final submission of 24 December 2004 and through its witnesses and arguments at or after the Witness Hearing.

2.9 The Arbitral Tribunal does not consider [Respondent]'s Claim 2(f) in the Rejoinder submission, to be "outside the limits of the Terms of Reference" but even it were to consider otherwise, in light of the nature of the claim and the stage of the proceedings and there being no other or contrary considerations which the Tribunal finds to be overriding, the Arbitral Tribunal would have decided to permit this [Respondent] claim to remain in the proceeding. The Arbitral Tribunal denies [Claimant]'s request to have [Respondent]'s Claim 2(f) stricken from the Arbitration Record.

2.10 The Arbitral Tribunal is also not of the mind to strike [Respondent]'s Claim 2(i) in its Rejoinder submission. This claim is simply an attempted reservation of a right to develop [Respondent]'s case and to produce all evidence necessary for that purpose. The rules for production of evidence and making of submissions, at least through the Witness Hearings scheduled to start on 31 January 2005, have been carefully established by the Arbitral Tribunal's prior Procedural Order and correspondence of the Chairman written on behalf of the Arbitral Tribunal. If and to the extent either Party wishes to "develop" its case and or to "produce all relevant evidence", it has been given the opportunity to do so, equally and fairly between the two Parties in accordance with an originally agreed schedule, since modified on a number of occasions either by Party agreement or by Tribunal order on the reasoned request of a Party, after hearing the other Party's position.

2.11 The Arbitral Tribunal does not consider that [Respondent]'s Claim 2(i) adds or subtracts anything from this legal situation, and is thus not in fact a substantive claim, but rather a reservation of the procedural rights granted under the Terms of Reference and Procedural Orders in this case, as amended, under the ICC Rules and finally under the governing Swiss law including Chapter 12 of the LDIP. The Arbitral Tribunal denies [Claimant]'s request to have [Respondent]'s Claim 2(i) stricken from the Arbitration Record.

2.12 Neither Party's right at the Witness Hearings to rebut, or to oppose, or to object to any factual or expert evidence produced by the other Party in this proceeding shall be affected by the rulings in this Part II of the present Procedural Order.'

1
The Parties' current claims in this Arbitration, as reflected in the pleadings, are not entirely the same in wording or in quantum as those set out originally in the Prayers listed in (a) [Claimant]'s Notice of Arbitration dated 7 October 2003, (b) [Respondent]'s Answer and Counterclaim of 10 December 2003, (c) [Claimant]'s Reply to the Counterclaims and Additional Claim of 16 January 2004, and (d) [Respondent]'s Answer to the Additional Claim and Additional Counterclaim of 12 March 2004, which were the basis for the listing of claims in Part VII of the Terms of Reference dated and signed on 29 March 2004. This is not unusual, nor has it been commented on by either Party. Such a development of claims and the related issues in the course of an international arbitration proceeding is to be expected. In this respect, Part VIII of the Terms of Reference reflects the agreement of the Parties and the Arbitral Tribunal at the time that it would be inappropriate in this case to establish a listing of issues, noting Article 18(1)(d) of the ICC Rules and that experience demonstrates such issues can develop and/or change, sometimes dramatically, during the course of the arbitral proceedings.