YES

We show the termination of the TRS R:

  *(x,*(y,z)) -> *(otimes(x,y),z)
  *(|1|(),y) -> y
  *(+(x,y),z) -> oplus(*(x,z),*(y,z))
  *(x,oplus(y,z)) -> oplus(*(x,y),*(x,z))

-- SCC decomposition.

Consider the dependency pair problem (P, R), where P consists of

p1: *#(x,*(y,z)) -> *#(otimes(x,y),z)
p2: *#(+(x,y),z) -> *#(x,z)
p3: *#(+(x,y),z) -> *#(y,z)
p4: *#(x,oplus(y,z)) -> *#(x,y)
p5: *#(x,oplus(y,z)) -> *#(x,z)

and R consists of:

r1: *(x,*(y,z)) -> *(otimes(x,y),z)
r2: *(|1|(),y) -> y
r3: *(+(x,y),z) -> oplus(*(x,z),*(y,z))
r4: *(x,oplus(y,z)) -> oplus(*(x,y),*(x,z))

The estimated dependency graph contains the following SCCs:

  {p1, p2, p3, p4, p5}


-- Reduction pair.

Consider the dependency pair problem (P, R), where P consists of

p1: *#(x,*(y,z)) -> *#(otimes(x,y),z)
p2: *#(x,oplus(y,z)) -> *#(x,z)
p3: *#(x,oplus(y,z)) -> *#(x,y)
p4: *#(+(x,y),z) -> *#(y,z)
p5: *#(+(x,y),z) -> *#(x,z)

and R consists of:

r1: *(x,*(y,z)) -> *(otimes(x,y),z)
r2: *(|1|(),y) -> y
r3: *(+(x,y),z) -> oplus(*(x,z),*(y,z))
r4: *(x,oplus(y,z)) -> oplus(*(x,y),*(x,z))

The set of usable rules consists of

  (no rules)

Take the reduction pair:

  lexicographic combination of reduction pairs:
  
    1. lexicographic path order with precedence:
    
      precedence:
      
        + > * > otimes > *# > oplus
      
      argument filter:
    
        pi(*#) = [1, 2]
        pi(*) = [1, 2]
        pi(otimes) = [2]
        pi(oplus) = [1, 2]
        pi(+) = [1, 2]
    
    2. matrix interpretations:
    
      carrier: N^1
      order: standard order
      interpretations:
        *#_A(x1,x2) = x1 + x2
        *_A(x1,x2) = x1 + 1
        otimes_A(x1,x2) = x2 + 2
        oplus_A(x1,x2) = x1 + x2 + 1
        +_A(x1,x2) = x1 + x2 + 1
    

The next rules are strictly ordered:

  p1, p2, p3, p4, p5

We remove them from the problem.  Then no dependency pair remains.