TAS-CAS – Tribunale Arbitrale dello Sport – Corte arbitrale dello Sport (2007-2008)———-Tribunal Arbitral du Sport – Court of Arbitration for Sport (2007-2008) – official version by www.tas-cas.org – Arbitration CAS 2007/A/1388 Racing Club de Strasbourg Football v. Ismaily Sporting Club & CAS 2007/A/1389 Ismaily Sporting Club v. Racing Club de Strasbourg Football, award of 21 May 2008 Panel: Mr Rui Botica Santos (Portugal), President; Mr Luc Argand (Switzerland); Mr Christian Duve (Germany) Football Transfer and loan of a player Standing to be sued of FIFA Principle of freedom of employment Interest rate

Tribunal Arbitral du Sport - Court of Arbitration for Sport (2007-2008) - official version by www.tas-cas.org - Arbitration CAS 2007/A/1388 Racing Club de Strasbourg Football v. Ismaily Sporting Club & CAS 2007/A/1389 Ismaily Sporting Club v. Racing Club de Strasbourg Football, award of 21 May 2008 Panel: Mr Rui Botica Santos (Portugal), President; Mr Luc Argand (Switzerland); Mr Christian Duve (Germany) Football Transfer and loan of a player Standing to be sued of FIFA Principle of freedom of employment Interest rate 1. If the Parties to the proceedings have not applied for FIFA to be joined as a party in the appeal (which involves a decision by the CAS as to the granting or rejection of the said procedural application), opportunity is nevertheless given to FIFA to participate in the proceedings, on a voluntary basis, in its capacity as the body appealed against. This invitation, which can be accepted or declined by FIFA, is made by the CAS on its own initiative. If FIFA declines to participate, any claim against FIFA is struck out on the grounds that the body against whom the said order is sought is not a party to the proceedings. 2. Given the principle of freedom of employment, it is not legally possible to require a football player to play for club A or club B, and, therefore, to return to his former club. In the event of breach of an employment contract, or of any other contractual relationship, the only means at the disposal of those parties, which considered that they have sustained loss and damage, is to have recourse to the proper courts in order to seek compensation for the loss and damage incurred, including an application for the imposition of sporting sanction on the defaulting player, as the case may be. 3. The FIFA Rules and Regulations do not contain provisions dealing with interest due for delayed payment under contracts. Therefore, the law applicable to the contractual relationship governs the issue. If the parties have not agreed to a contractually defined rate of interest in case of default, the statutory rate applies. The Racing Club de Strasbourg Football (RCSF) is a football club with its registered office in Strasbourg, France, member of the French Football Federation (FFF), itself affiliated to the Fédération Internationale de Football Association (FIFA). The Ismaily Sporting Club (“Ismaily”) is a football club with its registered office in Ismaily City, Egypt, member of the Egyptian Football Association (EFA), itself affiliated to the FIFA. The present appeals were filed by both Parties against the decision rendered by the Single Judge of the FIFA Player’s Status Committee (PSC) passed on 28 August 2007, notified to the Parties on 5 September 2007. Considering that the two procedures have the same object, this description of the facts is a consolidated resume of all submissions and documents filed by the Parties in both procedures. The circumstances stated below are a summary of the relevant facts, as established on the basis of the written submissions of the Parties of the files of appeal against the PSC decision passed on 28 August 2007 (the “PSC Decision”). The FIFA file and the discussions held during the hearing were also taken into consideration. On 30 May 2005, Ismaily and RCSF signed a transfer contract (the “Transfer Contract”) regarding the transfer of the player H. (the “Player”) from Ismaily to RCSF, as from the 2005/2006 football season, for a compensation of EUR 1,100,000 (one million one hundred thousand euros). On 8 August 2005, the Player and the RCSF signed an employment contract, for the four following football seasons, valid until the end of the season 2008/2009. Under article 2 of the Transfer Contract, the agreed fee of EUR 1,100,000 should be paid by RCSF to Ismaily as follows: a. EUR 400,000 (four hundred thousand euros) on 15 July, 2005; b. EUR 400,000 (four hundred thousand euros) on 31 January, 2006; and c. EUR 300,000 (three hundred thousand euros) on 15 July, 2006. The first two agreed payments were made by RCSF on their due dates. On 28 July 2006, the Parties and the Player concluded a loan agreement (the “Loan Agreement”), under which RCSF loaned the Player to his former club Ismaily for the duration of the season 2006/2007. As per article 2.2 of the Loan Agreement, RCSF and Ismaily agreed that this latter club could exercise the definitive transfer option of the Player on 1 July 2007 for the duration of three seasons by effecting a payment of EUR 800,000, to be paid as follows: a. the last EUR 300,000 instalment on 15 July 2006 due by RCSF under the Transfer Contract would be postponed to June 15, 2007. In case of exercise of the purchase option by Ismaily, this amount would be compensated and deduced from Ismaily’s payment of EUR 800,000; and b. the remaining EUR 500,000 would be paid by Ismaily on or before 15 June 2007, by means of a bank transfer to RCSF’s bank account with the bank BNP. It was further agreed that if Ismaily failed to pay the EUR 800,000 compensation on or before 15 June 2007, it would have to pay a penalty of EUR 300,000 to RCSF and the Player would have to immediately return to RCSF. This penalty would be paid by means of an offsetting of the last instalment due by RCSF to Ismaily. On 1 August 2006, within the scope of the Loan Agreement, the Player signed an employment contract with Ismaily for the duration of three seasons (until the season 2008/2009). On 30 May 2007, Ismaily informed RCSF of its interest to exert the option for the permanent transfer of the Player, further proposing that the relevant amount be paid to RCSF in three instalments: EUR 150,000 on 15 July 2007; EUR 150,000 on 15 July 2008 and EUR 200,000 on 15 July 2009. After such date further contacts were held by the Parties, notably as regards the payment terms for the EUR 500,000 by Ismaily. On 18 June 2007, RCSF informed Ismaily that it considered that the condition for the definitive transfer of the Player had not been fulfilled and that the loan of the Player would end on 30 June 2007. By letter dated 19 June 2007, Ismaily sent to RCSF a cheque in the amount of EUR 500,000, which has never been cashed by RCSF. The said check was dated 15 June 2007. On 25 June 2007, RCSF: a. Informed the FFF that Ismaily had not exerted the purchase option and, therefore, not fulfilled the condition for the definitive transfer of the Player; b. Informed the EFA, via FFF, that the payment of EUR 500,000 should have been effected on 15 June 2007 at the latest in order for the Player to be able to stay with Ismaily and, since these terms had not been respected, the Player would have to rejoin RCSF as to comply with his contractual obligations; and c. Executed a transfer contract of the Player with El Ahly Sporting Club, Egypt (“El Ahly”), for a compensation of EUR 700,000 plus 15% of the net profit of a future transfer to another club. This contract was co-signed by the Player but, later on, the Player signed a declaration in which he confirmed his wish to play for Ismaily and to respect his contractual obligations towards this latter club. The Player alleged that he was persuaded to co-sign the contract by RCSF and his agent. They informed him that he had to choose between El Ahly or El Zamalek Sporting Club, otherwise, he would be suspended from playing, not being permitted to play abroad because of his military service situation. By letter of 28 June 2007, the FFF requested the International Transfer Certificate (ITC) of the Player from the EFA and by letter of the same day, EFA informed FFF that Ismaily made the payment as for the term of condition of the Loan Agreement and that the EFA considered the temporary transfer of the Player to be a final transfer as from 1 July 2007. In fact, on 5 July 2007, Ismaily made a Swift transfer of EUR 500,000 and the respective amount entered at RCSF’s bank account. However, on 10 July 2007, RCSF declared that it did not accept the payment and that it still considers that the condition for the definitive transfer of the Player had not been fulfilled. On 11 July 2007, and following the request of its member RCSF, the FFF filed an ITC request for the provisional registration of the later at FIFA, asking the Single Judge of the Player’ Status Committee to order the EFA to issue the ITC for the Player. On 15 July 2007, upon FIFA’s intervention, EFA informed that it could not issue the relevant ITC since another affiliated club (El Ahly Sporting Club) had concluded a transfer agreement with RCSF, apparently also signed by the Player and that this club requested the ITC from the FFF. Within the same correspondence, the EFA forwarded to FIFA a declaration signed by the Player that he wishes to play for Ismaily and to fulfil his obligations towards this club. On 8 August 2007, the Single Judge of the FIFA Player’s Status Committee refused to authorize the FFF to provisionally register the Player for its affiliate RCSF. The decision was notified to the Parties on 17 August 2007. Further to the above mentioned request filed by the FFF, on 20 August 2007 RCSF declared its intention to appeal to FIFA’s Dispute Resolution Chamber, based on the following arguments: a. RCSF considers that the terms of the “Convention de prêt assorti d’une mutation définitive” (“Loan agreement with a permanent transfer option clause”), notably its article 2, paragraph 2.2, b), had not been fulfilled by Ismaily, since it had not paid the sum of EUR 500,000 to RCSF on or before 15 June 2007. b. RCSF considers that option was not regularly exerted by Ismaily and, therefore, disputes the registration of the Player with Ismaily. c. RCSF requests, consequently, the return of the Player to RCSF. To the above mentioned exchange of correspondence and argumentation, the Single Judge of the PSC confirmed that it was competent to deal with and pass a decision in the dispute between RCSF and Ismaily regarding the exercise of an option for the definitive transfer of the Player. It further resolved that the edition 2005 of the FIFA Regulations for the Status and Transfer of Players was applicable to the case as to the substance (the “FIFA Regulations”). As regards the substance of the matter, the PSC limited its decision to the contractual relationship between the two clubs involved with respect to the transfer agreement and to the proper exertion of an option for the definitive transfer of the Player. It excluded, therefore, any questions regarding any employment contracts entered into by the Player and any club. With respect to the Loan Agreement and in particular regarding the “permanent transfer option clause” entered into by the Parties, the PSC took note of the following preliminary facts: a. On 28 July 2006, the two clubs and the Player had agreed upon a Loan Agreement in which RCSF lent the Player to Ismaily for the football season 2006/07; b. An option clause was included in the Loan Agreement stipulating that Ismaily had the right to opt for the definitive transfer of the Player by paying the sum of EUR 500,000 on 15 June 2007 at the latest; c. Ismaily had intended to make use of said option and the employment agreement signed with the Player on 1 August 2006 had already been signed for a period going beyond the duration of the loan; d. For this reason, the EFA refused to issue the relevant ITC to the FFF when the latter asked for such certificate; e. The FFF asked FIFA for its intervention in order to be authorized to provisionally register the Player for its member club RCSF; f. The Single Judge of the PSC rejected such request on by means of a decision dated 8 August 2007; g. However, such decision was passed without prejudice to any decision which might be passed by the PSC or its Single Judge as to the substance of the contractual dispute arisen between the clubs with regard to the loan agreement in general and, in particular, the exercise of the option for the definitive transfer of the Player; h. The exercise of the option by Ismaily had to be done by means of the payment of EUR 500,000 on 15 June 2007, at the latest; i. As to the date of the actual exertion of the option by Ismaily, the PSC considered that, despite of the cheque’s value date (15 June 2007), the cheque could not be cashed by RCSF prior to its receipt; j. Apparently the cheque was only received by RCSF on 25 June 2007, and the bank confirmed only on 5 July 2007 that the account of RCSF had been accredited with the amount of EUR 500,000; k. RCSF acknowledged the receipt the relevant amount only in 10 July 2007. l. RCSF had coherently and consistently communicated to Ismaily that it did not accept different payment modalities and that the amount of EUR 500,000 had to be paid on 15 June 2007 at the latest. Considering all the above, the PSC declared and resolved that: a. The payment of EUR 500,000 by Ismaily had been done on a later date than 15 June 2007; b. The condition for the definitive transfer of the Player stipulated in the loan agreement concluded between the parties was not properly fulfilled by Ismaily; c. Therefore, the PSC accepted RCSF’s claim since the option for the definitive transfer of the Player to Ismaily had not been validly exercised by Ismaily, and, consequently, the loan of the Player had expired in 30 June 2007; d. Furthermore, the PSC found undisputable that RCSF still had not paid to Ismaily the last instalment in the amount of EUR 300,000 for the definitive transfer of the Player under the Transfer Agreement concluded between the two clubs on 30 May 2005; e. The PSC concluded that, therefore, RCSF still has to pay EUR 300,000 to Ismaily for the definitive transfer of the Player; f. In accordance to the PSC’s decision RCSF shall further have to reimburse EUR 500,000 to Ismaily, undisputedly paid by the latter to RCSF; g. As far as the FIFA proceedings costs is concerned, the Single Judge of the PSC concluded that Ismaily has to bear the relevant costs as per article 25 par. 2 of FIFA Regulations in combination with art. 15 par. 1 of the Rules Governing the Procedures of the Players’ Status Committee and the Dispute Resolution Chamber. The PSC’s Single Judge Decision was the following: “1. The claim lodged by the Claimant, RC Strasbourg, is accepted. 2. It is established that the Respondent, Ismaily SC, has not validly exercised the option for the definitive transfer of the player H.. 3. The Claimant, RC Strasbourg, has to pay the EUR 800’000 to the Respondent, Ismaily SC, within 30 days of notification of the present decision. 4. In case the terms of the present decision are not respected, the matter shall be referred to the Disciplinary Committee of FIFA so that the appropriate disciplinary measures may be held. 5. The costs of the proceedings in the amount of CH 2,000 are to be paid by the Respondent, Ismaily SC, within 30 days of notification of the present decision to the following bank account (…). 6. According to art. 61 par. 1 of the FIFA Status, this decision may be appealed against before the Court of Arbitration for Sport (…)”. On 24 September 2007, pursuant to art. 61 para. 1 of the FIFA Statutes, RCSF filed a “Statement of Appeal”, which also has to be considered as the “Appeal Brief”, with the Court of Arbitration for Sport (CAS) against the PSC Decision, which states the facts and legal arguments giving rise to the appeal. This appeal procedure was registered with the reference On 25 September 2007, pursuant to the same art. 61 para. 1 of the FIFA Statutes, Ismaily filed his “Statement of Appeal” with the CAS against the PSC Decision, which states the facts and legal arguments giving rise to the appeal. This appeal procedure was registered with the reference CAS 2007/A/1389. On 28 February 2008, a hearing took place in Lausanne, Switzerland. During the hearing, Ismaily requested the admission to file an additional document as evidence intended to prove that RCSF had indeed tried to cash the EUR 500,000 cheque that had been sent by Ismaily in 19 June 2007 with the bank BNP Paribas. RCSF opposed to the filing of such document. LAW Jurisdiction 1. The jurisdiction of CAS, which is not disputed, derives from art. 61 par. 1 of the FIFA Statutes and R47 of the Code. Furthermore, the Parties confirmed the jurisdiction of CAS by signing the order of procedure. 2. It follows that the CAS has jurisdiction to decide the present dispute. The mission of the panel follows from Article R57 of the CAS Code, granting the panel full power to review the facts and the law of the case. Furthermore, the same article provides that the panel may issue a new decision which replaces the decision challenged or may annul the decision and refer the case back to the previous instance. Preliminary procedural issues 3. The Panel refused the filing of the document requested by Ismaily (cf. above) under Article R56 of the CAS Code because (i) Ismaily failed to prove that extraordinary circumstances occurred to justify the late filling of the said document and (ii) the Panel also considered that such document would be irrelevant for the purposes aimed at by Ismaily, because the written submissions by the Parties and the documents that were already filed with the process were considered sufficient for the Panel to decide on the substance of the procedures. Admissibility A. Regarding the issue of the Player’s ITC and the return of the Player to RCSF 4. Given the claims made by RCSF regarding the issue of the Player’s ITC and the return of the Player to the club, the Panel makes the following preliminary considerations and decision: a. Given the manner in which this appeal has been brought, this Panel has no powers to order FIFA, or any association or federation, which is a member of FIFA, to issue the Player’s ITC, as is well established in the CAS case-law, as RCSF did not apply for FIFA to be joined as a party in these appeals (CAS/A/1082-1104). b. The fact that the CAS Court Office invited FIFA to state whether it wished to be a party in these proceedings must be viewed in the light of the opportunity, which is always given to FIFA, to participate in the proceedings, on a voluntary basis, in its capacity as the body appealed against. The fact is that the said invitation, which was declined by FIFA, was made by the Court Office on its own initiative and not as a consequence of any application by the Parties, which would have involved a decision by this Panel as to the granting or rejection of the said procedural application. This being so, the claim made by RCSF that FIFA be ordered to issue the Player’s ITC to it, is struck out on the grounds that the person against whom the said order is sought is not a party to these proceedings. c. The claim made by RCSF that the Player return to this Club and play for the team during the 2007/2008 sporting season must also fail for the same procedural reason – i.e. the person against whom the order is sought is not a party to these proceedings – as the Player is not a party in these appeal proceedings. d. In any event, it should be noted that, given the principle of freedom of employment, it is not legally possible to require a football player to play for club A or club B. In the event of breach of an employment contract, or of any other contractual relationship, the only means at the disposal of those parties, which considered that they have sustained loss and damage, is to have recourse to the proper courts in order to seek compensation for the loss and damage incurred, including an application for the imposition of sporting sanction on the defaulting player, as the case may be (TAS 2003/O/530, TAS 2004/A/791). e. Finally, reference is made to the fact that the said claim by RCSF is materially impossible, as the player registration period in the French championship has already terminated and will only reopen at the end of the said sporting season. B. Regarding any damages payable by the Parties 5. In its appeal (CAS 2007/A/1388), RCSF also seeks permission to claim damages for the loss and damage sustained by it as a consequence of the breach by Ismaily of the FIFA regulations. 6. However, this claim was neither pleaded in the proceedings before FIFA, which is the subject matter of these appeals, nor has RCSF pleaded any facts and evidence with regard thereto in these appeals. The said claim is accordingly dismissed. 7. So far as the alleged breach, by RCSF, of the provisions of the Preamble of the Loan Agreement is concerned, i.e. the obligation not, until the end of the 2006/2007 season, to oppose the permanent transfer of the Player to Ismaily, the Panel makes the following clarification: a. It follows from the interpretation of the Loan Agreement, given that Ismaily had not complied with the condition stipulated for the exercise of the permanent transfer option, that RCSF was entitled to sell the Player at the end of the season covered by the Loan Agreement. There is no breach of any commitment in this regard, to the extent that the Player would always remain at Ismaily until the end of the 2006/2007 season; b. Furthermore, Ismaily has not proved any loss or damage arising from the alleged breach; and c. That this question was not considered in the FIFA proceedings. 8. For the reasons stated above, any claim by Ismaily with regard to any alleged breach of the Loan Agreement by RCSF is dismissed. Applicable law 9. Art. R58 of the Code reads as follows: “The Panel shall decide the dispute according to the applicable regulations and the rules of law chosen by the Parties or, in the absence of such a choice, according to the law of the country in which the federation, association or sports-related body which has issued the challenged decision is domiciled or according to the rules of law, the application of which the Panel deems appropriate. In the latter case, the Panel shall give reasons for its decision”. 10. Art. 60.2 of the FIFA Statutes provides as follows: “The provisions of the CAS Code of Sports-Related Arbitration shall apply to the proceedings. CAS shall primarily apply the various regulations of FIFA and, additionally, Swiss law”. 11. The Panel remarks that the “applicable regulations” are indeed all applicable FIFA rules and regulations material to the dispute at stake. 12. During the hearing, the Panel inquired with the Parties whether there was anything they wanted to add with respect to the legal assessment of the Loan Agreement. In particular, the Panel raised the question whether there were any issues of French law that the Parties wanted to submit to the Panel for legal consideration. Counsel for both Parties agreed that the Panel interpret the Loan Agreement in accordance with general principles of contractual law. 13. During the hearing, the Parties expressed the view that the contract should be interpreted in accordance with general principles of contractual law. 14. Therefore, the Panel holds that the dispute must be decided according to FIFA statutes and regulations, to the clauses of the Transfer Agreement and the Loan Agreement, to the general principles of law and to French law, if necessary. Merits of the dispute 15. The claims made by each party in their respective appeal briefs correspond to their respective counterclaims to the other party’s appeal. Therefore, the Panel holds it appropriate to render a sole award for both procedures (CAS 2007/A/1388 and CAS 2007/A/1389). 16. These proceedings shall have the same limitation as to subject-matter, as the PSC Decision. Therefore, the Panel shall only take into consideration the questions arising from the contractual relationships between the Parties hereto, that is, the claims related to the Transfer Agreement and the Loan Agreement regarding the player H. and no other claims are admissible. 17. Having already decided the questions mentioned in the admissibility section, we shall now decide with regard to the other claims made by the Parties in the appeals, i.e.: a. Did Ismaily exercise the permanent transfer option in respect of the Player, which was agreed in the Loan Agreement signed by the Parties on the 28th of July 2006, duly and properly? b. What sums are payable by each of the Parties to the other party pursuant to the provisions of the said Loan Agreement and the Transfer Agreement signed by them, the former on the 28th of July 2006 and the latter on the 30th of May 2005? A. Regarding the exercise of the permanent transfer option regarding the Player by Ismaily 18. Ismaily maintains that the transfer option in respect of the Player was duly exercised, to the extent that: a. The extension of the contractual time-limit for the payment of the sum of EUR 500,000 (five hundred thousand euros) was orally agreed at least while negotiations between the Parties, regarding Ismaily’s proposed deferral of the payment, were pending; b. It was not in possession of the details of RCSF’s bank account in order to be able to make an international transfer in the sum of EUR 500,000 (five hundred thousand euros) in due time; and c. RCSF, by seeking to collect on the cheque sent by Ismaily on the 19th of June 2007 voluntarily, accepted the exercise of the permanent transfer option with regard to the Player by Ismaily. 19. The Loan Agreement is clear when it provides in clause 2.2 thereof that the exercise of the option by Ismaily must be effected via the payment of the sum of EUR 500,000 (five hundred thousand euros) by the 15th of June 2007. The fact that Ismaily informed RCSF, on the 31st of May 2007, that it intended to exercise the option cannot, per se, amount to the exercise of the option, to the extent that the perfection of this obligation could only occur in compliance with the condition stipulated in the clause, i.e. the payment of the sum of EUR 500,000 (five hundred thousand) by the 15th of June 2007. 20. It is undeniable that the payment of the EUR 500,000 (five hundred thousand euros) took place after the 15th of June 2007. 21. It is undeniable that Ismaily failed to do so. The Panel must accordingly consider whether the facts and circumstances pleaded by Ismaily amount to an agreement to defer the payment timelimit, or to any grounds for the late payment thereof, as the payment of the amount in question took place later. 22. Of the documents lodged in these proceedings, which are relevant to the above, the following are particularly noteworthy: a. The fax of the 30th of May 2007 from Ismaily to RCSF, which informs the latter of the former’s intention to exercise the option and requesting the payment of the agreed amount by instalments; b. The fax of the 31st of May 2007, sent by RCSF to Ismaily, rejecting the proposed payment by instalments; c. The fax of the 10th of June 2007, sent by Ismaily to RCSF, requesting the sending of an invoice. At the hearing Ismaily clarified that this request for an invoice referred to RCSF’s bank details; d. The fax of the 12th of June 2007, sent by RCSF to Ismaily, reiterating the club’s position, i.e. compliance with the agreement and payment of the full amount of the compensation by June 15th, 2007; e. The fax of the 15th of June, sent by Ismaily to RCSF, once again requesting payment of the sum due by instalments as follows: - EUR 150,000 (one hundred and fifty thousand euros) on the 15th of July 2007; - EUR 150,000 (one hundred and fifty thousand euros) on the 15th of July 2008; and - EUR 200,000 (two hundred thousand euros) on the 15th of July 2009. f. The letter sent by Ismaily to RCSF, on the 19th of June, sending the cheque in the sum of EUR 500,000 (five hundred thousand euros) to RCSF; g. The original cheque for EUR 500,000 (five hundred thousand euros) sent by Ismaily to RCSF; h. The Swift transfer of the sum of EUR 500,000 (five hundred thousand euros) to RCSF’s account at BNP Paribas on the 3rd of July 2007; i. The Swift of the reception of the sum of EUR 500,000 (five hundred thousand euros) in RCSF’s account at BNP Paribas on the 5th of July 2007; and j. RCSF’s reply dated the 10th of July 2007, in which it expressly states that it refuses the EUR 500,000 (five hundred thousand euros) payment made by Ismaily. During the hearing before the panel, the Chairman of Ismaily, Mr. El Komi, himself indicated that that, in the various telephone conversations with the Chairman of RCSF, the latter, at no time, clearly and unequivocally agreed to any deferral of the payment of the amount agreed for the 15th of June 2007. In particular, Mr. El Komi referred to a call with M. Gintestet on June 15, 2007, who told him that he could not make a decision to extend the deadline during such telephone conversation. Then, according to the recollection of Mr. El Komi, M. Gintestet returned his call on Monday or Tuesday of the following week and indicated that no extension was possible. Furthermore, Mr. El Komi, admitted that the club had financial difficulties with regard to the payment of the agreed sum of EUR 500,000 (five hundred thousand euros). Accordingly, the Chairman of Ismaily confirmed what followed already from the record. 23. The Panel considers that it has not been proved by either documentary or witness evidence that RCSF ever agreed to extend the contractual time-limit stipulated for the exercise, by Ismaily, of its permanent transfer option in respect of the Player: a. Ismaily repeatedly approached RCSF with a view to the renegotiation of the time-limit for the payment of the sum payable on the 15th of June 2007, to which RCSF always reacted negatively in writing, by refusing any proposal to defer the contractually agreed payment. b. At no time, RCSF showed any willingness to extend the time-limit initially agreed for the exercise of the option, not even for the period during which conversations between the Parties regarding Ismaily’s proposal that the payment be deferred, were pending. c. It has not been proved that Ismaily requested RCSF to provide all the details of its bank account, in order to be able to make the transfer within the agreed time-limit and that RCSF refused to provide it with the necessary information. Accordingly, the argument, whereby the Egyptian club claims that the creditor is liable for its delay in the performance of the obligation, fails. Indeed, the fax of the 10th of June 2007 (receipt of which by RCSF was not duly proved) in which Ismaily requests RCSF to send an invoice cannot, even if it was received by RCSF, be considered to be a demand for the supply of the complete details of the bank account. On the 31st of May 2007, when Ismaily expressed an interest in the exercise of the option, it makes no mention of information regarding the bank account, as it could, and should, have done. The meaning of this communication is to request the deferral of the payment. A diligent debtor must take steps in due time in order to obtain all the information necessary in order to comply fully with the conditions to which it is subject in order to perfect the obligations to which it is contractually bound. Indeed, it is not apparent from the case file that RCSF subsequently provided Ismaily with the complete information regarding its bank account, and this fact did not prevent Ismaily from transferring the sum of EUR 500,000 (five hundred thousand euros) by Swift to the correct bank account on the 3rd of July 2007. The position defended by Ismaily, to the effect that RCSF attempted to collect the cheque, has no basis in the documentation submitted, to the extent that the original document (the cheque) to which the Panel and the parties had access at the hearing bears no sign (rubber stamp or annotation) of having been presented for payment. In the Panel’s opinion, not even the statement lodged in the proceedings by Ismaily as Exhibit 17 of the Appeal Brief demonstrates that the cheque was collected by RCSF. On the 5th of July 2007, when Ismaily made a Swift transfer of EUR 500,000 (five hundred thousand euros) to RCSF’s bank account, the agreed time-limit for the exercise of the option by Ismaily had expired a long time previously. This transfer can likewise not be construed as an acceptance of the payment, as RCSF indicates clearly in its letter of the 10th of July that it rejects the payment made by Ismaily. 24. It is evident from the documents lodged in these proceedings that all of RCSF’s replies rejected payment of the option by instalments (which was requested insistently by Ismaily). 25. As it was Ismaily that pleaded that the time-limit for the exercise of the option was extended at least while the negotiations regarding Ismaily’s proposal that the payment be deferred were pending, it had the burden to prove this fact. However, the Panel considers, particularly given the documental evidence submitted in these appeals, that it has not been proved that there was an agreement between the Parties to extend the time-limit for the exercise of the option, not even while the negotiations were pending. 26. Ismaily only sent the cheque for the said sum after the contractually agreed date, apparently on the 19th of June 2007. The said payment was, however, not accepted by RCSF, which considered immediately that Ismaily had not exercised its option on the terms agreed. 27. It is also necessary with further regard to this matter, to consider whether RCSF did anything which could be construed as an acceptance of the late payment of the EUR 500,000 (five hundred thousand euros) and accordingly ratified the deferral of the said payment and, consequently, accepted the exercise of the contractual option by Ismaily. 28. In the light of the above, the Panel considers that, notwithstanding the fact that Ismaily communicated its intention to exercise its permanent transfer option with regard to the Player to RCSF, it failed to exercise the same duly and completely, as agreed in the contract between the parties, so that the Panel accordingly confirms the part of the decision of the PSC which determines that “[i]t is established that the Respondent, Ismaily SC, has not validly exercised the option for the definitive transfer of the player H.”. B. Regarding the amounts claimed by the Parties 29. The PSC decision appealed against makes an award against RCSF to pay “EUR 800’000 to the Respondent, Ismaily SC, within 30 days of notification of the present decision”, which amount corresponds to the final instalment due in respect of the transfer of the Player to RCSF (EUR 300,000) plus the amount transferred tardily by Ismaily to RCSF’s bank account (EUR 500,000). 30. Ismaily wishes the decision of the PSC to be upheld in this respect. 31. RCSF maintains however, that it is merely obliged to return the sum of EUR 500,000 (five hundred thousand euros) to Ismaily, which it received from it, as the sum of EUR 300,000 (three hundred thousand euros) with regard to the final instalment agreed at the time of the transfer of the Player from Ismaily to RCSF should be set-off against the EUR 300,000 (three hundred thousand euros), which Ismaily is liable to pay pursuant to the provisions of the Loan Agreement, because it failed to properly exercise its permanent transfer option in respect of the Player. 32. The Panel considers that it has been duly proved that the Parties agreed, in clause 2.2(c) of the Loan Agreement, that “if Ismaily failed to pay the EUR 800,000 compensation on or before 15 June 2007, it would have to pay a penalty of EUR 300,000 to RCSF”. If the payment of those penalties was to be executed by means of a set-off with the payment of the EUR 300,000 instalment by RCSF to Ismaily, effectively RCSF would not owe any payment to Ismaily. 33. The Panel also notes that Ismaily did not pay any contribution for the use of the Player in the 2006/2007 sporting season, so that, in the Panel’s opinion, the sum of EUR 300,000 (three hundred thousand euros) that the parties agreed on as a penalty in the event of failure to exercise the option would, in practice, amount to a payment by Ismaily. 34. As has already been stated, the Panel considers that Ismaily failed to pay the EUR 800,000 (eight hundred thousand euros) compensation on or before 15 June 2007 and that it is accordingly liable to pay the agreed penalty of EUR 300,000 (three hundred thousand euros) to RCSF. 35. As it is undisputed that the sum of EUR 300,000 (three hundred thousand euros) was still outstanding and due to Ismaily pursuant to the Transfer Agreement, the Panel accordingly decides that the credits in the said sum be set-off between the Parties and that RCSF should accordingly pay the total sum of EUR 500,000 (five hundred thousand euros) to Ismaily, corresponding to the amount of the Swift transfer tardily effected by Ismaily. C. Interest Rates 36. Ismaily claims the return of the sum of EUR 500,000 (five hundred thousand euros) plus default interest at the legal rate of 8 percentage points above the current Repo Overnight Index (SNB) as from 4 July 2007, without pleading any legal provision as to the applicable interest rate. 37. According to the provisions of the contracts between the Parties, the law applicable to the contractual relationship is French law for the issues which are not covered by the FIFA statutes and regulations, or which do not follow from the provisions of the Transfer Agreement and the Loan Agreement or from general principles of law. 38. As a matter of French law, such interest would amount to interest on arrears (“intérêts moratoires sur dettes de sommes d'argent”), the purpose of which is to compensate a delay in the payment of a monetary amount due under a contract (See MALINVAUD Ph., Le droit des obligations, para. 645). Pursuant to French private international law, compensation of a breach of contract is an issue that is governed by the proper law of the contract in question (See MAYER/HEUZÉ, Droit international privé, para. 1345). 39. Article 3 of the Loan Agreement is governed by the FIFA Rules and Regulations, and French law, insofar as it does not contradict the FIFA Rules and Regulations. However, Article 3 states further that mandatory provisions of French law will override the FIFA Rules and Regulations. 40. The FIFA Rules and Regulations do not contain provisions dealing with interest due for delayed payment under contracts such as the Loan Agreement. It, therefore, appears that French law governs the issue. 41. The relevant provision as a matter of French law is Article 1153 of the French Civil Code, which provides that “[i]n obligations which are restricted to the payment of a certain sum, damages awarded as a result of the delay in performing the obligation in question shall consist only of an award of interest calculated at the statutory rate of interest, unless specific commercial rules or legal provisions relating to guarantees and security apply. Such damages are due without the creditor having to prove a loss. They are due only from the date of the demand for payment, except in cases where interest accrues as a matter of law…”. 42. In the present case, Ismaily is claiming for interest as of 12 November 2007, with its Statement of Defense filed in the appeal case with the reference CAS 2007/A/1388. Pursuant to Article 1153 of the Civil Code, such interest accrues from the date the demand for payment of interest was made to RCSF. 43. As to the rate of interest, it appears that the statutory rate of interest applies here, given that the parties have not agreed to a contractually defined rate of interest in case of default. For 2007, 2.95%. Prima facie, Ismaily, therefore, has no grounds for claiming for interest at “8 points above the current Repo Overnight Index”. 44. The Panel accordingly decides that the interest rate applicable to the reimbursement of the sum of EUR 500,000 (five hundred thousand euros) shall be 2,95%, as from 12 November 2007 until effective payment in full to Ismaily. D. Conclusion 45. Given the manner in which this appeal has been brought and particularly the fact that FIFA and the Player are not parties in these appeals, the following claims made by RCSF are improperly brought for lack of a party against whom the claim is made and are accordingly struck out: (i) that FIFA be ordered to issue the Player’s International Transfer Certificate to it and (ii) that the Player be ordered to return to RCSF. 46. The claim that the Player return to RCSF during the 2007/2008 season is also struck out on the grounds of temporal impossibility. 47. So far as the other claims made by the Parties in the appeals are concerned it is held, first of all, that the permanent transfer option was not duly exercised by Ismaily, as it has not been proved that: - The extension of the time-limit for the exercise, by Ismaily, of the permanent transfer option was agreed orally; - RCSF refused and was requested to provide Ismaily with correct and complete information regarding its bank account, so that Ismaily could effect the agreed payment in due time; and - RCSF attempted to collect the cheque sent to it by Ismaily on the 19th of July 2007 and thereby accepted the payment, which Ismaily sought to make. 48. It has however been proved that the compensation payable by Ismaily to RCSF in the sum of EUR 300,000 (three hundred thousand euros) in the event that it failed to duly exercise its permanent transfer option, in accordance with the provisions of the Loan Agreement, is, in fact, due and that an identical amount is also payable by RCSF to Ismaily, in respect of the final instalment agreed when the Player was initially transferred to Strasbourg. The two said amounts should accordingly be deemed to be paid by set-off of the credits between the Parties. 49. Finally, it is ordered that RCSF repay the payment improperly received in the sum of EUR 500,000 (five hundred thousand euros), plus default interest at the applicable legal rate from the banking day following the receipt of the sum in question (6th of July 2007), in accordance with the applicable French law, to Ismaily, at 2.95% per annum starting on 12 November 2007 until the effective date of payment. 50. All other claims made by the Parties within the ambit of appeals The Court of Arbitration for Sport rules: 1. The appeals filed on 24 September 2007 and on 25 September 2007, regarding CAS 2007/A/1388 and CAS 2007/A/1389 against the decision handed down on 28 August 2007 by the FIFA Players’ Status Committee are partially upheld. 2. The decision issued on 28 August 2007 by the FIFA Players’ Status Committee is partially reformed in the sense that: a. Ismaily Sporting Club is ordered to pay to Racing Club de Strasbourg Football the amount of EUR 300,000, as a contractual penalty, since it has not validly exercised the option for the definitive transfer of the player H. under the terms agreed in the Loan Agreement signed by the Parties on 28 July 2006 b. Racing Club de Strasbourg Football is ordered to pay to Ismaily Sporting Club pursuant to the initial Transfer Agreement of the player H. signed between the Parties on 30 May 2005, the amount of EUR 300,000. c. The amount of EUR 300,000 as a contractual penalty, to be paid by Ismaily Sporting Club to Racing Club de Strasbourg Football, is to be set off against the balance of EUR 300,000 due by the Racing Club de Strasbourg Football to Ismaily Sporting Club pursuant to the initial Transfer Agreement of the player H. signed between the Parties on 30 May 2005; and d. Racing Club de Strasbourg Football is ordered to pay to Ismaily Sporting Club the amount of EUR 500,000 (five hundred thousand euros), plus interest at 2.95% per annum starting on 12 November 2007 until the effective date of payment. 3. (…). 4. (…). 5. All other or further claims and counterclaims are dismissed.