TAS-CAS – Tribunale Arbitrale dello Sport – Corte arbitrale dello Sport (2011-2012)———-Tribunal Arbitral du Sport – Court of Arbitration for Sport (2011-2012) – official version by www.tas-cas.org – CAS 2012/A/2702 Györi ETO v. UEFA ARBITRAL AWARD rendered by the COURT OF ARBITRATION FOR SPORT sitting in the following composition: President: Mr. Rui Botica Santos, Attorney-at-law, Lisbon, Portugal Arbitrators: Mr. Stuart McInnes, Solicitor, London, England. Prof. Denis Oswald, Attorney-at-law and Professor in Colombier, Switzerland Ad hoc Clerk: Mr. Felix Majani, Attorney-at-law, Nairobi, Kenya in the arbitration between Györi ETO, Györ, Hungary Represented by Mr. Juan de Dios Crespo Pérez and Mr. Adam Whyte, Attorneys-at-law, Valencia, Spain -Appellantand Union des Associations Européennes de Football (UEFA), Nyon, Switzerland Represented by Mr. Ivan Cherpillod and Mr. Jean-Samuel Leuba, Attorneys-at-law, Lausanne, Switzerland – Respondent-

TAS-CAS - Tribunale Arbitrale dello Sport - Corte arbitrale dello Sport (2011-2012)----------Tribunal Arbitral du Sport - Court of Arbitration for Sport (2011-2012) - official version by www.tas-cas.org - CAS 2012/A/2702 Györi ETO v. UEFA ARBITRAL AWARD rendered by the COURT OF ARBITRATION FOR SPORT sitting in the following composition: President: Mr. Rui Botica Santos, Attorney-at-law, Lisbon, Portugal Arbitrators: Mr. Stuart McInnes, Solicitor, London, England. Prof. Denis Oswald, Attorney-at-law and Professor in Colombier, Switzerland Ad hoc Clerk: Mr. Felix Majani, Attorney-at-law, Nairobi, Kenya in the arbitration between Györi ETO, Györ, Hungary Represented by Mr. Juan de Dios Crespo Pérez and Mr. Adam Whyte, Attorneys-at-law, Valencia, Spain -Appellantand Union des Associations Européennes de Football (UEFA), Nyon, Switzerland Represented by Mr. Ivan Cherpillod and Mr. Jean-Samuel Leuba, Attorneys-at-law, Lausanne, Switzerland - Respondent- I. THE PARTIES 1. Györi ETO (hereinafter referred to as the “Appellant” or the “Club”) is a Hungarian professional football club and a member of the Hungarian Football Federation (hereinafter referred to as the “HFF”). The latter is a member of the Fédération Internationale de Football Association (hereinafter referred to as the “FIFA”) and the Union des Associations Européennes de Football. 2. The Union des Associations Européennes de Football (hereinafter referred to as the “Respondent” or “UEFA”) is the body in charge of running football in the continent of Europe working with and acting on behalf of Europe's national football associations. II. THE FACTS 3. This appeal was filed by the Club against the decision rendered by the UEFA Appeals Body (hereinafter referred to as the “UEFA Appeals Body”) passed on 29 November 2011 (hereinafter referred to as the “Appeal Decision”). The grounds of the Appeal Decision were notified to the Parties on 12 January 2012. 4. A summary of the most relevant facts and the background giving rise to the present dispute will be developed on the basis of the Parties’ submissions and the evidence adduced during the hearing. Additional factual background may also be mentioned in the legal considerations of the present award. In this award, the Panel only refers to the submissions and evidence it considers necessary to explain its reasoning. II. 1 The contractual relationship between the Appellant and FC Flora Tallinn 5. On 13 February 2009, the Appellant entered into an agreement with Estonian club FC Flora Tallinn (hereinafter referred to as “Flora”) for the transfer of the player Jarmo Ahjupera (hereinafter referred to as the “Player”) from Flora to the Appellant (hereinafter referred to as the “Transfer Agreement”). 6. Under clause 1.2 of the Transfer Agreement, Flora agreed to transfer the Player to the Appellant in exchange for a fee (hereinafter referred to as the “Transfer Fee”) of EUR 100,000 to be paid in two instalments: “(…) first half in 50.000 euro (fifty thousand euro) within 15 (fifteen) days from the date of signing this transfer contract, other half 50.000 (fifty thousand euro) until 30.06.2009.” 7. Flora and the Appellant specifically agreed under clause 1.3 of the Transfer Agreement that “[t]he transfer fee shall be paid according to the Transferring Club´s invoices and transferred by bank transfer to the invoice mentioned bank account.” 8. On 17 February 2009, Flora issued the invoice related to the first instalment in the amount of EUR 50,000 with number 90205. (Annex 4 of the Appeal Brief). 9. On 18 February 2009, the Appellant asked Flora to send the “original invoice - signed, stamped – by post” (Annex 3 of the Appeal Brief). 10. On 20 February 2009, the Appellant received the invoice related to the first instalment with number 90205 dated 17 February 2009 (Annex 4 of the Appeal Brief). 11. On 10 March 2009, the Appellant requested Flora to extend the deadline for paying the first instalment to 31 March 2009. It made a “100% guarantee” to pay the Transfer Fee by 31 March 2009 (Annex 2 of the FIFA File related to the dispute between the Appellant and Tallinn). This request was accepted by Flora. 12. On 31 March 2009, the Appellant “(…) confirm[ed] and guarantee[d] that the transfer fee in the amount of 100.000 Euro (…) for the player Jarmo Ahjupera will be paid until 30th of April 2009. The above mentioned amount will be transferred into Jalgpalliklubi FC Flora´s bank account which will be written in the invoice.” (Annex 6 of the Appeal Brief). 13. On 22 April 2009, Flora issued the invoice related to the second instalment in the amount of EUR 50,000 with number 90431 (Annex 22 of the Appeal Brief). The Parties dispute the date when this second invoice was received. 14. On 29 April 2009, Flora issued: a further invoice, related to the first and second instalments in the amount of• EUR 100,000 with number 90429; and a Credit Note in the amount of EUR 50,000 with number 90430 cancelling the• invoice number 90205 in the amount of EUR 50,000. This Credit Note was issued following the requested extension for payment of the 100% of the Transfer Fee (Annex 22 of the Appeal Brief). 15. By 16 July 2009, Flora had not received any payment. It sent a claim against the Appellant to the Estonian Football Association (hereinafter referred to as the “EFA”) and asked the EFA to lodge it with FIFA. 16. On 20 July 2009, the EFA filed the claim before FIFA on Flora’s behalf, asking it to intervene, alleging that the Appellant had failed to pay. 17. Between 20 July 2009 and 26 February 2010, correspondence was exchanged between the EFA and the HFF on behalf of the Parties in relation to whether any term of the Transfer Agreement or the UEFA Club Licensing Regulations (hereinafter referred to as the “UEFA Club Licensing Regulations”) had been breached. 18. On 26 February 2010, the EFA informed UEFA that the Transfer Fee due from the Appellant had not been paid. 19. In order to prove that it has no payables overdue towards other football clubs as at December of the year preceding the season to be licensed, Article 47 of the UEFA Club Licensing Regulations requires clubs, to prepare and submit to the licensor a transfer payables table disclosing all transfer activities, including loans, which have been undertaken up to 31 December. 20. The Appellant states that when it received the first invoice dated 17 February 2009 this debt “(…) was recorded into the accounts of Györi and included in its license application for the 2010/2011 season under overdue payables. Payment of such was effected, in accordance with the UEFA Club Licensing Regulations (…) on 31 March 2010” (Paragraph 6 of the Appeal Brief). 21. Thereafter, on 10 March 2010, the Appellant prepared its transfer payables table (hereinafter referred to as the “Transfer Payables Form”) and sent it to the HFF. (Annex 12 of the Answer). 22. In the Transfer Payables Form, the Appellant declared that its transfer payable due as at 31 December 2009 was 13´542 Hungarian Forint “thousand HUF”. It is therefore the Panel´s understanding that this amount translated to 13,542,000 Hungarian Forint, which is the equivalent of EUR 50,000. This was also confirmed in the Respondent’s Answer (paragraph 23). 23. The Appellant was granted a UEFA club competition license and took part in the UEFA Europa league club competition for the 2010-2011 season, receiving EUR 360,000 from UEFA as participation fees. 24. On 31 March 2010, the Appellant paid Flora EUR 50,000. The Appellant’s bank statement states as reference of the payment “90205B0119/2009; Jarmo Apjupera 50.000,00 EUR” (Annex 5 of the Appeal Brief). The transfer refers to payment of invoice 90205, but this invoice was cancelled by the credit note number 90430 dated 29 April 2010. 25. On 8 April 2010, the EFA wrote to the HFF, acknowledging receipt of EUR 50,000 on behalf of Flora. It however informed the HFF that the Appellant was yet to pay more than half of the Transfer Fee according to the Transfer Agreement, which comprised EUR 50,000 along with the following interest: 5% per year out of 50•,000 EUR for the period 01.03.2009-30.06.2009 (836 EUR) 5% per year out of 100,000 EUR for the period 01.07.2009-05.04.2009 (3 822• EUR) 5% per year out of 50,000 EUR for the period 06.04.2010 until the day of• payment. 26. The Parties exchanged correspondence in relation to the second instalment, and on 12 April 2010, the Appellant informed the HFF that “[b]y the Public Accounting Law described document which was sent by FC Folra Tallin to our club, the Györi FC Kft.paid that by transfer. Our company not became due obligation towards to the Estonian club. In the letters between the two clubs never arose to pay any default interest, so the Estonian Football Association is not entitled to require that from us.”(Annex 16 of the Appeal Brief). 27. On 1 July 2010, the EFA informed UEFA´s Club Licensing Unit that the HFF had issued the Appellant with a UEFA License although the latter had failed to meet Article 47 annex VIII of the UEFA Club Licensing Regulations by defaulting in paying the second instalment of EUR 50,000 due to Flora on 30 June 2009, together with the then accrued interest of EUR 5,158. 28. On 30 July 2010, the EFA sent the Appellant a copy of an invoice of EUR 50,000 related to the payment of the second instalment. This invoice is numbered 90431 and dated 22 April 2009. 29. On 3 August 2010, the Appellant informed the EFA that the invoice received and mentioned in the previous paragraph did not comply with Hungarian and European Union laws. It requested the EFA to inform Flora to send the “(…) original, invoice signed and sealed, as they did in the case of sending the invoice for the first 50,000 EUR” (Annex 23 Appeal Brief). 30. On 9 August 2010, through the EFA, and in response to the Appellant´s letter dated 3 August 2010, Flora sent a copy of the invoice number 90431 dated 22 April 2009. It contained Flora´s stamp and signature and was received by the Appellant on 16 August 2010. 31. The Appellant paid the second instalment of EUR 50,000 as follows: EUR 25,000 on 21 September 2010;• EUR 20,000 on 9 November 2010; and• EUR 5,000 on 17 November 2010.• 32. On 18 May 2011, the UEFA Club Financial Control Panel (hereinafter referred to as the “CFC”) issued its report in relation to the licence granted by the HFF to the Appellant (hereinafter the “CFC Report”). 33. The CFC Report found that the Appellant had failed to meet a number of criteria laid down in the UEFA Club Licensing Regulations 2008. The CFC and the UEFA Control and Disciplinary Body opened disciplinary proceedings. II.2 The UEFA Control and Disciplinary Body Decision 34. On 16 June 2011, the UEFA Control and Disciplinary Body issued its decision, (hereinafter referred to as the “UEFA Disciplinary Decision”). It found both the Appellant and the HFF guilty of violating the UEFA Club Licensing Regulations and issued the following sanctions: a. The HFF was fined EUR 100,000, half of which was suspended for a probationary period of 2 years. b. The Appellant was disqualified from taking part in the next UEFA competition for which it qualified for the next 3 seasons, 2011-2012, 2012-2013 and 2013- 2014, and fined EUR 50,000. c. The UEFA Disciplinary Decision was based in the following grounds: i. The Appellant had failed to prove that it had no overdue payables on 31 December of the year preceding the season to be licensed. ii. The Appellant had committed a serious offence. The absence of any previous infringement was not a decisive factor. The importance of the UEFA club licensing system, which aims at protecting the integrity of UEFA club competitions, was also considered. iii. The fact that the Appellant had received EUR 360,000 from UEFA for taking part in the 2010-2011 UEFA Europa League and the fact that its participation was based on a license given on the basis of misleading documents was considered; and iv. The HFF was liable for failing to undertake due diligence, and for granting the Appellant a license despite the latter´s failure to meet the criteria. II.3 The UEFA Appeals Body Decision 35. On 15 and 20 July 2011, the HFF and the Appellant respectively appealed against the UEFA Disciplinary Decision. 36. In its appeal, the Appellant stated that it was not required to indicate the full sum due on 31 December 2009 because Flora had neither sent an invoice nor indicated the bank account number into which the payment was to be made. It further argued that the second instalment was not an overdue payment because Flora had filed proceedings before FIFA. 37. On 29 November 2011, the UEFA Appeals Body rendered the Appeal Decision, partially upholding the Appellant´s appeal and held as follows: a. The UEFA Disciplinary Decision suspending the Appellant from the next 3 UEFA club competitions which it would otherwise have qualified for was set aside. This decision was replaced with a decision only suspending the Appellant from the UEFA club competition for the 2011-2012 and 2012-2013 seasons, in case it qualified. The disqualification related to the 2013-2014 season was suspended. b. The UEFA Disciplinary Decision fining the Appellant EUR 50,000 was upheld. c. The Appellant and the HFF were jointly and severally liable for the legal costs related to the UEFA appeal proceedings EUR 6,000. Each party was to pay EUR 3,000. 38. The Appeal Decision was based on the following grounds: a. The fact that Hungarian law obliges creditors to send debtors invoices and to indicate the bank account number into which the amount due is to be paid is not effective against UEFA´s club licensing rules. b. The Appellant had failed to prove that it did not have any payments overdue as at 31 December 2009 as required under Article 47.1 of the UEFA Club Licensing Regulations. c. The Appellant had not proved that it had entered into an agreement with Flora postponing the deadline for paying the second instalment. The fact that Flora had not requested for payment of the second instalment did not mean that the deadline stipulated in the Transfer Agreement had been extended. d. The Appellant cannot take advantage of the FIFA proceedings opened by Flora because a debtor who is the subject of a procedure for payment opened by a creditor cannot be treated more favourably than a debtor against whom such a procedure has not been opened. e. Contrary to Article 47 of the UEFA Club Licensing Regulations, the Appellant had failed to provide the information required in relation to debts, more specifically those relating to the payment due from the Transfer Agreement. f. Pursuant to Article 14.1 of the UEFA Disciplinary Regulations, a disciplinary body has wide discretion to impose fines ranging between EUR 100 and EUR 1,000,000. Given the fact that the Appellant had unduly received EUR 360,000 from UEFA for taking part in the UEFA 2010-2011 Europa League, the fine of EUR 50,000 imposed by the UEFA Disciplinary Decision was appropriate. g. The UEFA Disciplinary Decision to disqualify the Appellant from the next 3 UEFA Club competitions it qualifies was harsh because the Appellant trusted the HFF, which despite being informed of the existence of the overdue payment, did not bother seeking the Appellant´s explanation. h. Supposing it qualifies, the Appellant was disqualified from the UEFA competition 2012-2013. The Appellant´s disqualification from the UEFA competition 2013-2014 was suspended for a probationary period. In case the Appellant committed any further offences during the licensing procedure for the 2012-2013 season, the original sanctions issued by the UEFA Disciplinary Decision would be re-activated. III. THE ARBITRAL PROCEEDINGS BEFORE THE CAS 39. On 20 January 2012, the Appellant filed its Statement of Appeal at the Court of Arbitration for Sport (hereinafter referred to as the “CAS”). 40. On 30 January 2012, the Appellant filed its Appeal Brief and nominated Mr. Stuart McInnes as its arbitrator. The Respondent was granted 20 days with effect from 1 February 2012 within which to file its Answer. 41. On 3 February 2012 the Appellant requested the CAS Court Office to treat the matter as an expeditious proceeding, stating that an award ought to be issued before the end of May 2012 so that the Appellant would know whether it was eligible to take part in the next UEFA club competition. 42. On 7 February 2012, the Respondent agreed with the Appellant´s request that the matter be treated expeditiously. 43. On 22 February 2012, the Respondent requested a 5 day extension to its deadline to file the Answer. On the same day, the Appellant expressed its consent to the said request. 44. On 22 February 2012, the CAS Court Office extended the Respondent´s deadline for filing its Answer to 27 February 2012. 45. On 27 February 2012 the Respondent filed its Answer and nominated Prof. Denis Oswald as its arbitrator. 46. On 27 February 2012, the CAS Court Office requested the Parties to state whether they wanted a hearing or preferred the matter to be decided on the basis of written submissions. 47. On 27 February 2012, the Appellant expressed its wish for a hearing. 48. On 2 March 2012, the Parties were informed that the Panel appointed to decide the above-referenced case was constituted as follows: Mr. Rui Botica-Santos, Attorney-at-law in Lisbon, Portugal as President.• Mr. Stuart McInnes, Solicitor, London, England, appointed by the Appellant.• Prof. Denis Oswald, Attorney-at-law and Professor in Colombier, Switzerland,• appointed by the Respondent. The Panel aslo appointed Mr. Felix Majani, Attorney-at-law, Nairobi, Kenya to act as the ad hoc clerk. 49. On 19 March 2012, the CAS Court Office took some preliminary and evidentiary measures, inviting the Parties to: a) State when FC Flora sent the second invoice b) Adduce a copy of the second invoice c) Adduce any correspondence in relation to the payment, in addition to those adduced by the Appellant. 50. On 20 March 2012, the CAS Court Office informed the Parties that the matter would be heard on 27 April 2012 at the CAS headquarters. They were invited to state whether they intended to call any witnesses or had any witness statements to adduce. 51. On 22 March 2012 the Order of Procedure was sent to the Parties, who both signed the same. 52. On 26 March 2012, the Appellant informed the CAS Court Office that the second invoice was sent on 10 August 2010 and enclosed a copy of the said invoice. In addition to the documents adduced in the Appeal Brief, it did not adduce further correspondence in relation to the payment. The Appellant also sent a list of the people who would attend the hearing on its behalf. 53. On 26 March 2012, the Respondent informed the CAS Court Office of the people who would attend the hearing on its behalf. It stated that the second invoice was sent on 29 April 2009 and requested that the CAS ask for a copy of the FIFA file involving the dispute between Flora and the Appellant in order to see whether further documents in relation to the second invoice would be found. It also challenged the admissibility of the witness statements adduced by the Appellant in the Appeal Brief as annex 32, 35, 36 and 37, stating that they were mere allegations and constituted opinions which cannot be regarded as evidence, whether confirmed or not in person by the witnesses in question. 54. On 27 March 2012, the Appellant reiterated its wish for the FIFA file to be produced with a view to ascertaining when Flora sent the second invoice. 55. On 28 March 2012, the Appellant informed the CAS Court Office that the witness statements whose admissibility the Respondent had challenged related to facts which occurred during the licensing process and also during the FIFA proceedings. It also informed the CAS Court Office that one of the witnesses was an independent auditor who would give direct evidence. It reiterated that the second invoice was sent on 10 August 2010. 56. On 29 March 2012, the CAS Court Office informed the Parties that the issues raised by the Respondent in relation to the witness statements would be addressed during the hearing, where the Parties would be given the chance to raise their views. The Parties were requested not to send any further correspondences unless invited by the Panel. Furthermore, the CAS Court office asked FIFA to adduce a copy of the file related to the proceedings between the Appellant and Flora. 57. On 10 April 2012, the CAS Court Office received a copy of the FIFA file. 58. On 12 April 2012, the Appellant sent a decision dated 24 February 2012 issued by UEFA´s Control and Disciplinary Body (hereinafter referred to as the “Bursaspor case). It requested that the said decision be admitted pursuant to Article R56 of the Code of Sports-related Arbitration (hereinafter referred to as the “CAS Code”) because it was not in its possession at the time the appeal was filed, and hence raised exceptional circumstances. 59. On 12 April 2012, the CAS Court Office granted the Respondent a deadline until 16 April 2012 to state whether it objected to the admission of the Bursaspor case, failure to which the Panel would issue a ruling. 60. On 16 April 2012, the Respondent informed the CAS Court office that it did not object to the admission of the Bursaspor case. It however drew the Panel’s attention to the fact that the said decision was nevertheless not final and binding since an appeal had been filed before the UEFA Appeals Body. 61. On 19 April 2012, the Appellant requested the CAS Court Office to ask the Respondent whether the appeal against the Control and Disciplinary Body decision dated 24 February 2012 had already been issued, and in case of the affirmative, to send a copy of the said appeal decision before the hearing. 62. On 20 April 2012, the CAS Court Office granted the Respondent until 26 April 2012 to state whether the UEFA Appeals Body had rendered its decision in relation to the Bursaspor case. 63. On 20 April 2012, the Respondent informed the CAS Court Office that the UEFA appeals body had not rendered its decision in relation to the Bursaspor case, and that a hearing was fixed for May 2012. 64. On 27 April 2012, the hearing was held at the CAS headquarters in Lausanne, Switzerland. The Panel was assisted at the hearing by Mr. William Sternheimer, Counsel to the CAS and Mr. Felix Majani as the ad hoc Clerk. During the hearing, the Appellant was represented by the counsels Mr. Juan de Dios Crespo Peréz and Mr. Adam Whyte. The Respondent was represented by the counsels Mr. Ivan Cherpillod and Mr. Jean-Samuel Leuba. 65. Also in attendance for the Appellant were: Mr. Tibor Klement – Managing Director• Dr. Zoltán Mikuska – Personal Secretary to the Managing Director• Mr. Mathias Imre – Interpreter• Mr. András Kiss – Translator• Mr. Zoltán Gertner – ex-Licensing Manager and witness• Dr. Tamás Gudra – head of the HFF club licensing and witness• Mr. István Szabo – expert witness• 66. In attendance for the Respondent were: Mr. Veron Mosengo-Omba - UEFA´s Disciplinary Services• Mr. Pablo Rodriguez - Compliance Manager National Associations / Club• Licensing and Fair Play. 67. During the hearing, the Respondent did not raise any issue in relation to the admissibility of annexes 32, 35, 36 and 37 of the Appeal Brief. The Appellant however objected to Mr. Pablo Rodriguez giving an expert opinion, although it was accepted that he would be available to the Panel in case it required any expert assistance in interpreting the UEFA regulations. 68. At the conclusion of the hearing, the Parties confirmed that they had no objections in respect to the manner in which the hearing had been conducted, in particular the principles of the right to be heard and to be treated equally in the arbitration proceedings. IV. THE PARTIES´ POSITIONS IV.1. The Appellant’s position a. Law applicable 69. The matter ought to be resolved in accordance with the UEFA Club Licensing Regulations edition 2008, Swiss law in supplementation, and the European Council Directive (hereinafter referred to as the “EC Directive”). b. No overdue payables to Flora 70. Pursuant to clause 1.2 of the Transfer Agreement, payment was only due after issuance of an invoice and the second invoice would only become due and payable when Flora issued a “proper invoice” compliant with Hungarian laws and EC Directive on 16 August 2010. This was further emphasised in clause 1.3 of the Transfer Agreement, in the Appellant´s email dated 18 February 2009 and in several other requests for a proper invoice. 71. Flora sent the first invoice in good form. UEFA has not proven that the Appellant received the second invoice for the first time on 30 July 2010, and the principle of venire contra factum proprium must therefore be applied. 72. Article 218 of the EC Directive requires member States, such as Hungary, to accept invoices which meet the conditions related to invoicing as set out in chapter 3 of the said directive. According to its witness Mr. István Szabo, a proper invoice must state the date of fulfilment, the subject matter, be signed and posted to the debtor (Annex 36 of the Appeal Brief). 73. Under Articles 220 and 221 of the EC Directive, all taxable people, including Flora must ensure that invoices are issued for goods or services supplied. 74. Flora´s failure to issue a proper and original invoice meant the said invoice did not comply with the EC Directive. 75. Moreover, section 289 of the Hungarian law criminalises any infringements of the accounting regulations by punishing any person who infringes his annual reporting, book keeping or auditing obligation with a view it obstructing the course of justice, with a maximum 2 year imprisonment, a fine or with community service. 76. Section 310 of the Hungarian criminal law imposes a custodial sentence upon any person who falsely declares or conceals any data for purposes of tax for up to 2 years labour in the public interest or a fine. 77. The Appellant hence risked criminal sanctions in case it paid the improper invoice sent by Flora. It claims to have sent Flora several reminders calling for a proper invoice, as a follow up to its correspondence dated 18 February 2009 and reiterates that pursuant to clause (3) 303 of the Hungarian civil code, there was no outstanding payment due because “(…) the delay of the claimant excludes the delay of the obligor(…)”. 78. Furthermore, CAS jurisprudence Feyenoord Rotterdam v Cruzeiro is clear that payments only become due after a proper invoice has been issued. From the said jurisprudence, it is apparent that the date of breach is when the invoice was not properly delivered, and this was also stipulated in the Transfer Agreement. It hence states that interest from any amount only accrues from the date of breach. 79. The Appellant adds that the breach of the Transfer Agreement started on the date the invoice was issued, meaning that the Club did not violate appendix VIII of the UEFA Club Licensing Regulations. c. The UEFA Appeals Body made mistakes in its interpretation of the events and the law 80. The Appellant also avers that the UEFA Appeals Body committed several errors in interpreting the events and the law as follows: a. The findings of the CFC that the Appellant had failed to prove that it received the second invoice on 16 August 2010 are false. This was actually proven in the EFA´s letter dated 9 August 2010, where it forwarded the said invoice which was received on 16 August 2010. Even though the second invoice is dated 22 April 2009, it is possible for the said invoice to have been pre-dated, or that someone might have failed to send it immediately after dating it. b. The CFC´s and the UEFA Disciplinary Decision findings that the Appellant provided misleading information in relation to overdue payables as at 31 March 2010 are false. Indeed, the HFF confirmed that pursuant to Hungarian and International laws, any overdue payments only become payable once an invoice has been received by the debtor. The Appellant was yet to receive the second invoice, meaning the HFF had not been misled. c. Co-related to this is the Disciplinary Inspector´s report, which in addition to stating that the Appellant had concealed the debt of EUR 50,000, was issued barely 48 hours before the UEFA trials began, hence obstructing the Appellant´s ability to prepare its defence. The Appellant reiterates that at no point did it conceal any debt. d. The Appellant adds that the Disciplinary Inspector´s report´s findings that clause 1.3 of the Transfer Agreement “(…) cannot be considered as a condition of the contract or (…) as making the EUR 100,000 fee subject to a condition” is false because payment cannot be made in the absence of an invoice. e. Contrary to the Appeal Decision’s findings, it is false that the Appellant is trying to use Hungarian laws to evade the club licensing criteria. Clause 1.3 of the Transfer Agreement was actually inserted for purposes of ensuring that Flora complied with Hungarian law and EC Directives. f. The Appeal Decision also failed to address whether the failure to issue the second invoice could relieve the Appellant from its obligation to pay Flora, and the potential impact of Flora´s failure to issue the said invoice. In addition, the Appeal Decision failed to carefully examine the Appellant´s submissions, and in stating that “(…) the second instalment (…) appears to have been paid in 2010 or even 2011” was unsure of when the second instalment was paid, despite the Appellant having adduced evidence proving that it was paid on 17 November 2010. g. The Appeal Decision made an error of fact by stating that the Appellant had deemed the deadline for paying the second instalment extended as a result of Flora´s failure to request payment of this instalment. The Appellant states that its position has always been that the second instalment would only be paid upon issuance of a proper invoice similar to the one sent in relation to the first instalment. h. The Appellant also avers that the HFF breached its duties under Article 5 section II of the UEFA Club Licensing Regulations by failing to assess the documents submitted to it and to verify whether the Appellant had met the UEFA licensing requirements. d. Disclosure of information 81. Moreover, through its officials Mr. Zoltán Gertner and Dr. Tamás Gudra, the HFF claims to have notified the HFF Licensing Body of all the facts relating to the Transfer Agreement, stating that there was no need to include the details related to the second instalment in the Transfer Payable Table. The HFF is hence to blame, and such blame was acknowledged by the UEFA Disciplinary Decision which attached “(…) considerable importance to the fact that member associations are the key to success of the UEFA club licensing system”. 82. In view of this, the Appellant claims to have acted in good faith, taken all reasonable steps to ensure compliance with the UEFA Club Licensing Regulations and the blame hence lies with the HFF. e. UEFA lacked jurisdiction to render the Appeals Decision 83. It is the Appellant´s position that pursuant to the Transfer Agreement, UEFA had no jurisdiction to issue the Appeal Decision. This jurisdiction lays squarely with FIFA, since clause 3.3 of the Transfer Agreement stipulated that “(…) conflicts shall be solved by the competent body of the FIFA (…)”. 84. The matter had already been brought before FIFA´s competent body and the HFF had agreed to FIFA´s jurisdiction. UEFA should therefore not have asserted its jurisdiction. This is corroborated by annex VIII of the UEFA Club Licensing Regulations pursuant to which an overdue payable at 31 December is not considered overdue if the license applicant is able to prove that “(…) proceedings have been opened with the statutory national or international football authorities (…).” f. Exemption from the UEFA Club Licensing Regulations 85. The Appellant argues that it also ought to have been exempted from the UEFA Club Licensing Regulations pursuant to annex I (A) of the said regulations. It avers that in light of subsection 1 (e) of the aforementioned regulation, the UEFA administration may grant an exception based on the “[n]on-applicability of a certain criterion defined in section IV due to national law or any other reason.”. In other words, UEFA provides exceptions to the club licensing regulations in the event that national law conflicts with the said regulations. 86. The Appellant´s obligation to include the second instalment as a payable conflicted with Hungarian criminal law. In view of this, the Appellant ought to have been exempted from the UEFA Club Licensing Regulations, and that pursuant to paragraph 3 annex I (B) of the said regulations, it was the HFF´s duty to request this exemption. g. Mitigation and disproportionality of the sanction 87. The Appellant claims that Hungary is a relatively small and inexperienced football nation, ranked 27th by FIFA and 29th in UEFA´s co-efficient, and that the Club has only taken part in UEFA competitions on two occasions since 1987. It request the CAS to take this into consideration, in view of the provisions of annex I (B) of the UEFA Club Licensing Regulations, which states that the status and situation of football within the territory of the member association will take into account the “[s]ize of the territory, population, geography, economic background (…).” 88. It is the Appellant´s assertion that the sanctions imposed by UEFA are disproportionate and contravene the principle of equality and legal certainty. It compares the sanctions imposed in the Appeal Decision to previous sanctions issued by UEFA against other clubs such as PAOK FC (hereinafter referred to as the “PAOK case”) for breaching the UEFA Club Licensing Regulations. It says that despite the debt in PAOK case being EUR 250,000, UEFA only excluded the club from one UEFA club competition for which it would have qualified over the next 3 seasons, and suspended the said exclusion for a probationary period of 3 years. h. Requests 89. The Appellant requests the CAS to issue the following relief: “1.To accept this appeal against the decision of the UEFA Appeals Body dated 29 November 2011. 2.To adopt an award annulling the said decision and adopt a new one declaring that the Appellant is eligible to compete in the next UEFA club competition for which it would qualify for. 3.To adopt an award annulling the said decision and adopt a new one declaring that the Appellant is not liable to pay any fine to UEFA. 4.To fix a sum of 20,000 CHF to be paid by the Respondent to the Appellant to aid the Appellant in the payment of its defence fees and costs. 5.To condemn the Respondent to the payment of the whole CAS administration costs and the Arbitrators fees.” IV.2. The Respondent’s position a. Law applicable and issues for determination 90. The law applicable is the UEFA Club Licensing Regulations supplemented by Swiss law. It adds that the UEFA Club Licensing Regulations are not dependent on national laws. 91. Pursuant to Article 154 of the Swiss Act concerning International Private Law, the UEFA regulations cannot be overridden by the national laws as this would lead to unequal treatment among clubs from different countries. Moreover, as a debtor, the UEFA Club Licensing Regulations cannot be construed in favour of the Appellant who has not denied the existence of a debt. Flora´s act of filing legal proceedings before FIFA should therefore not be used by the Appellant in its defence. 92. The UEFA Club Licensing Regulations were specifically enacted to ensure fair play in UEFA club competitions by improving the economic and financial capability of clubs and ensuring clubs punctually settle their liabilities with players and other clubs. 93. The only issues for determination are whether the Appellant (i) had any overdue payables, (ii) complied with Article 47 of the UEFA Club Licensing Regulations and (iii) concealed any relevant information in the transfer payables table. b. The Appellant had overdue payables 94. It is a fact that the Appellant received an invoice for the second instalment in April 2009 and in August 2010. Whether the said invoice was fake or original is irrelevant. Neither the Transfer Agreement, the UEFA Club Licensing Regulations, Hungarian or European Union laws make it mandatory for invoices to be original, signed and sealed. 95. The Appellant does not deny having received an invoice requesting payment of the second instalment. The Appellant only claims that no “proper” invoice was sent but has not adduced evidence to this effect. 96. The Appellant has not clarified what amounts to a “proper” invoice. It has not adduced a copy of what it claims to have been an improper invoice. Several invoices were actually sent by the EFA to the Appellant, one of which was dated 29 April 2009, containing the creditor’s name, an invoice number, registration number, VAT number, the beneficiary bank, IBAN, swift code and bank account number. There is no doubt that the second invoice was properly sent on 29 April 2009 and the Appellant is falsifying facts by claiming to have received an invoice for the second instalment for the first time only on 30 July 2010. 97. The Appellant waited until 3 August 2010, when it stated its reasons for not paying the second invoice, in order to gain time. These reasons, that the second invoice allegedly failed to comply with EC Directives and Hungarian law, were not specified and the Appellant did not indicate the legal provision which required the invoice to be signed. 98. UEFA questions whether there actually exists a law requiring original invoices to be signed. It refers to Article 229 of the EC Directive 2006/112, which states that “[m]ember States shall not require invoices to be signed.” In addition to this, the Hungarian criminal law invoked by the Appellant relates to book keeping and tax obligations and does not state that a debt must be paid only after an originally signed invoice has been received. 99. Pursuant to CAS 2005/O/985 Feyenoord v Cruzeiro, the Transfer Agreement must be construed in accordance with the FIFA Regulations on the Status and Transfer of Players (hereinafter referred to as the “FIFA RSTP”) and Swiss law. This means that under Article 102 of the Swiss Code of Obligations (hereinafter referred to as the “CO”), a debtor is deemed to be in default upon receiving a notice from the creditor demanding performance, or following an agreement with the creditor for paying on a specific date. The Parties had agreed that the second instalment would be paid on 30 June 2009, and the Respondent defaulted by paying it late in 3 instalments completed on 17 November 2010. c. The Appellant declared false information 100. In its application for a license, the Appellant declared false information in the Transfer Payables Form submitted to the HFF. It indicated that only an amount of 13,452,000 Hungarian Forint, which is equal to EUR 50,000, was due from the Player´s transfer. It made no mention of the total amount of EUR 100,000 and actually indicated 31 March 2010 as the due date as evidenced in a report dated 21 March 2011 compiled by Price Waterhouse Coopers. This contravened the disclosure requirements. 101. Not only was the first instalment, which was due at the end of February 2009 paid late on 31 March 2010, but the second instalment, due on 30 June 2009, was paid late on 17 November 2010. This means that an amount of EUR 100,000 was overdue on 31 December 2009 and had not been paid by 31 March 2010. 102. The Appellant did not declare the above amount which contravened Article 47.5 of the UEFA Club Licensing Regulations, which requires the Appellant to disclose the overdue payables, the entire Transfer Fee and the dates due. 103. UEFA refers to CAS jurisprudence, which it says does not uphold the notion that a debtor is not in default if he fails to pay a debt because an invoice has not been sent. 104. The mere fact that the HFF is also to blame does not exonerate the Appellant from liability. The Appellant knew that it had declared false transfer payables information and is liable for all the information it gives. d. UEFA had jurisdiction to render the Appeal Decision 105. The UEFA contests the Appellant´s view that only FIFA is competent to adjudicate this matter. The issue related to FIFA´s competence to deal with a transfer dispute must be differentiated with UEFA´s competence to deal with a matter related to breach of the UEFA Club Licensing Regulations, and to impose related sanctions. e. The Appellant is not entitled to any exemption 106. In order to benefit from the exemption provided in Annex I (A) of the UEFA Club Licensing Regulations, the HFF ought to have filed an application to this effect on the Appellant´s behalf as stipulated under Annex I (B) of the UEFA Club Licensing Regulations. In any case, the said application would have been denied because the Appellant failed to demonstrate that criminal sanctions would have been imposed upon it. f. Proportionality of the sanction 107. The Appellant´s assertions that the sanction imposed by the Appeal Decision is disproportionate are irrelevant. The Appellant committed two breaches; the first being the fact that it had overdue payables, and the second being its failure to disclose the exact payables. Disputes must be assessed on a case by case basis. The PAOK case is different from the present appeal. Furthermore, no information was concealed in the Bursaspor case, whose decision is currently under appeal and was also issued on the basis of different regulations, i.e the UEFA Financial Fair Play Regulations. UEFA cannot be required to justify the legitimacy of other decisions, even those relating to the same set of regulations. g. Request 108. UEFA concludes by requesting the CAS to “(…) dismiss the appeal and to order payment by the Appellant of all costs of the arbitration as well as legal costs suffered by UEFA.” V. LEGAL ANALYSIS V.1 Jurisdiction of the CAS 109. The jurisdiction of the CAS, which is not disputed, derives from Article 62.1 of the UEFA Statutes 2010 and Article R47 of the CAS Code. 110. Moreover, the Parties confirmed the jurisdiction of the CAS by signing the Order of Procedure. 111. It follows that the CAS has jurisdiction to decide this dispute. V.2 Admissibility 112. In accordance with Article 62.3 of the UEFA Statutes 2010, “[t]he time limit for appeal to the CAS shall be ten days from the receipt of the decision in question.” 113. The grounds of the Appeal Decision were notified on 12 January 2012 and the Statement of Appeal filed on 20 January 2012. This was within the required 10 days. 114. It follows that the appeal is admissible. Furthermore, no objection has been raised by the Respondent. V.3 Scope of the Panel´s review 115. According to Article R57 of the CAS Code, the Panel has full power to review the facts and the law of the case. Furthermore, 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. V.4 Law applicable to the merits 116. The appealed decision was issued by the UEFA, an association domiciled Switzerland. Article 63.3 of the UEFA Statutes 2010 states that “(…) proceedings before the CAS shall take place in accordance with the Code of Sports-related Arbitration of the CAS.” 117. Article R58 of the CAS Code provides the following: “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.” 118. The subject matter of the appeal relates to whether or not the Appellant violated the UEFA Club Licensing Regulations. It therefore follows that the specific UEFA laws applicable to this matter are the UEFA Club Licensing Regulations and UEFA Disciplinary Regulations edition 2008, which were applicable at the time of the alleged breaches. Furthermore, reference may also be made to Swiss law subsidiarily, given the fact that UEFA is an association domiciled in Switzerland. This is also confirmed by the Parties in their signed Orders of Procedure. V.5 The Merits of the Appeal 119. Based on the Parties´ submissions, the issues for determination are the following: 1. On a procedural basis: i. Whether the Appeal Decision made a mistake in its interpretation of the events and the law. ii. Whether the UEFA Appeals Body lacked jurisdiction to hear the dispute. 2. On a substantive basis: iii. Did the Appellant breach the UEFA Club Licensing Regulations? iv. In case of the affirmative, are the sanctions imposed in the Appeal Decision proportional? V.5.I The alleged mistakes in the interpretation of the events and the law committed by the UEFA Appeals Body 120. The Appellant avers that the UEFA Appeals Body made several errors as hereunder: a. it erroneously relied on the false CFC conclusion that the Appellant had failed to prove that it received the second invoice on 16 August 2010. b. it erroneously relied on the false CFC conclusion and the Appeal Decision findings that the Appellant provided misleading information in relation to overdue payables as of 31 March 2010. c. the Appellant was not given time to defend itself in relation to the contents of the Disciplinary Inspector´s report, which stated that the Appellant had concealed the debt of EUR 50,000. d. it erroneously found that that the Appellant was trying to use Hungarian law to evade the club licensing criteria. e. the Appeal Decision also failed to address whether the failure to issue the second invoice could relieve the Appellant from its obligation to pay Flora. f. the Appeal Decision failed to state with certainty, when the second instalment was paid. g. the Appeal Decision made an error of fact by stating that the Appellant had deemed the deadline for paying the second instalment extended as a result of Flora´s failure to request payment of this instalment. h. it overlooked the HFF´s breach of its duties under Article 5 section II of the UEFA Club Licensing Regulations to assess the documents submitted to it and to verify whether the Appellant had met the UEFA licensing requirements. 121. In relation to the above, the Panel refers to the fact that under these proceedings the Appellant had opportunity to present its case in the way to address and cure all the above mentioned irregularities as raised. 122. Therefore, pursuant to Article R57 of the CAS Code, which grants the Panel power to review the facts and the law, and CAS jurisprudence, any prejudice suffered by the Appellant before the UEFA Appeals Body has been cured by virtue of this appeal, in which the Appellant has been able to present its case afresh. (CAS 2008/A/1574 Nick d'Arcy v/Australian Olympic Committee, CAS 2009/A/1840 & CAS 2009/A/1851 PFC Slavia 1913 AD v Kayseri Erciyesspor Kulubu & Zdravko v Kayseri Kulubu, CAS 2008/A/1545 Andrea Anderson, LaTasha Colander Clark, Jearl Miles-Clark, Torri Edwards, Chryste Gaines, Monique Hennagan, Passion Richardson v/ IOC). Therefore, the Panel does not have to examine whether the alleged mistakes and errors in the interpretation of the events and the law have indeed been established. V.5.II Did the UEFA Appeals Body lack jurisdiction to hear the dispute? 123. It is the Appellant´s position that pursuant to the Transfer Agreement, UEFA had no jurisdiction to issue the Appeal Decision. It argues that this jurisdiction lay squarely with FIFA, since clause 3.3 of the Transfer Agreement stipulated that “[i]f the parties do not achieve a common agreement, the conflicts shall be solved by the competent body of the FIFA (…).” 124. It adds that the matter had already been brought before FIFA´s competent body and the HFF had agreed to FIFA´s jurisdiction. UEFA should therefore not have asserted its jurisdiction. 125. The Respondent avers that FIFA´s competence to deal with a transfer dispute must be differentiated with UEFA´s competence to deal with a matter related to breach of the UEFA Club Licensing Regulations, meaning UEFA had jurisdiction to hear the matter. 126. Under Article 27.1 of the UEFA Disciplinary regulations, “[t]he Control and Disciplinary Body handles disciplinary cases arising from breaches of the statutes, regulations, directives and decisions of UEFA. It decides on cases relating to player and club eligibility for UEFA competitions.” 127. Article 27.2 of the UEFA Disciplinary regulations adds that “[t]he Appeals Body is competent to hear appeals against decisions of the Control and Disciplinary Body in accordance with Article 49 of the present regulations.” 128. The subject matter of this appeal, together with the disputes before the UEFA Control and Disciplinary Body and the UEFA Appeals Body relate to whether the Appellant breached the UEFA Club Licensing Regulations. 129. UEFA was therefore competent to assert its jurisdiction on the basis of Article 27 of the UEFA Disciplinary Regulations, and the Appellant cannot argue that jurisdiction only belonged to FIFA in light of clause 3.3 of the Transfer Agreement. 130. The Panel remarks that the aforementioned clause only related to disputes between the Appellant and Flora in relation to the Transfer Agreement and not to any violation of the UEFA Club Licensing Regulations. 131. It therefore follows that the Appellant´s arguments on UEFA´s lack of competence are dismissed. V.5.III Did the Appellant breach the UEFA Club Licensing Regulations? a) Disclosure obligations under the UEFA Club Licensing Regulations 132. The Panel starts by analysing the UEFA Club Licensing Regulations in relation to the duty and the level of care imposed on clubs pursuant to the obligations to disclose the financial information to the national federations. 133. The aim of the duty of disclosure is to ensure that the clubs participating in a UEFA competition: a) Have adequate level of management and organization; b) Improve their economic and financial capability, by increasing their transparency and credibility, and placing the necessary importance on the protection of creditors; and c) Promote financial fair play in UEFA club competitions. (Article 2 of the UEFA Club Licensing regulations, the UEFA Club Licensing Regulations). 134. In further ensuring transparency and credibility in financial management, Article 41.2 f of the UEFA Club Licensing Regulations requires an applicant for a UEFA club competition license to ensure that “[a]ll submitted documents are complete and correct.” 135. Article 47.3, 47.4 and 47.5 of the UEFA Club Licensing Regulations also provides that as a license applicant, the Appellant was required to do the following: “47.3. (…) prepare and submit to the licensor a transfer payables table, unless the information has already been disclosed to the licensor under existing national transfer requirements (e.g. national clearing house system). It shall be prepared even if there have been no transfers/loans during the relevant period. 47.4. (…) disclose all transfer activities (including loans) undertaken up to 31 December. 47.5. The transfer payables table must contain a separate entry in respect of each player transfer (including loans) irrespective of whether there is an amount outstanding to be paid at 31 December. The following information must be given as a minimum: a) Player (identification by name or number); b) Date of the transfer/loan agreement; c) The name of the football club that formerly held the registration; d) Transfer (or loan) fee paid and/or payable (including training compensation); e) Other direct costs of acquiring the registration paid and/or payable; f) Amount settled; and g) The balance payable at 31 December in respect of each player transfer, detailed by due date(s) for each unpaid element of the transfer payables.” 136. The disclosure obligations are essential for UEFA to assess the financial situation of the clubs that are participating in its competitions and for this reason, as the Panel can confirm from the above quoted regulations, the disclosure must be correct and accurate. 137. The Panel shall hence use the aforesaid regulations as the basis for determining whether the Appellant breached any of the UEFA Club Licensing Regulations. 138. Due consideration shall also be given to the fact that the UEFA is domiciled in Switzerland, and therefore the UEFA Club Licensing Regulations shall further be interpreted in accordance with Swiss law (Article 63.3 of the UEFA Statutes 2010). a) Did the Appellant fail to disclose correct information? 139. It is manifest that the Appellant was required to ensure the correct and accurate disclosure to the HFF of all financial information. 140. However, from the information disclosed in the Transfer Payables Form in relation to the Player, the Appellant only indicated that an amount of 13´542,000 Hungarian Forint (EUR 50,000) was overdue in relation to the Transfer Agreement. 141. This was clearly misleading information because as at 10 March 2010, the Appellant had neither paid the first nor second instalments due from the Transfer Agreement, which totalled to EUR 100,000. 142. The excuses provided by the Appellant and explained by the 2 witnesses Mr. Zoltán Gertner and Dr. Tamás Gudra and the expert witness Mr. István Szabo were based on the fact that it did not receive a "proper" invoice, meaning an "original, signed and stamped" invoice. 143. The witnesses and the expert justified the Appellant’s attitude and the absence of disclosure of the amount due to Flora on the basis that under Hungarian civil, commercial and criminal laws such debt was not overdue. The witnesses and the expert also invoked Articles 220 and 221 of the EC Directive in supporting their arguments. 144. Neither the witnesses nor the Appellant have specified the exact Hungarian accounting, civil, commercial and criminal laws which required Flora (a non-resident entity of Hungary) to condition the payments to such national laws and to the presentation of a “stamped, sealed and signed” invoice. Notwithstanding these justifications and arguments, the Panel outlines that under the UEFA regulations, domestic laws are irrelevant and cannot be considered in assessing issues related to UEFA club licensing. 145. Even if the Hungarian civil, commercial and criminal laws were applicable, the reasons adduced by the Appellant in trying to invoke these laws are not convincing because: i. The Transfer Fee agreed in clause 1.2 of the Transfer Agreement is certain, liquid and enforceable. ii. The transfer of the Player was duly executed and the Appellant made use of the Player’s services. iii. Clause 1.3 of the Transfer Agreement does not specify the requirement claimed by the Appellant in relation to the presentation of a "signed and sealed" invoice. To the contrary, clause 1.3 of the Transfer Agreement says that “(…) the transfer shall be paid according to the Transferring Club’s invoices (…)” (emphasis added by the Panel). In the Panel’s understanding this sentence means that the Appellant had to pay the invoices as sent by Flora. iv. In exchange for receiving an extension from Flora in relation to the deadline for paying the first instalment, the Appellant guaranteed that it would pay 100% of the Transfer Fee by 31 March 2009. In its letter of 10 March 2009 the Appellant does not raise any issue in relation to the invoice presented. v. The Appellant’s payment on 31 March 2010 is related to the partial payment of invoice of EUR 100,000 numbered 90429, since invoice number 90205 in the amount of EUR 50,000 was cancelled by the Credit Note issued in the amount of EUR 50,000 with number 90430. As far as the Panel knows, the invoice numbered 90429 was partially paid notwithstanding the fact that it was not signed, sealed and stamped, and no sanctions have been imposed on the Appellant at national level for this partial payment. vi. The extension requests, as well as the timing in which the Appellant finally paid the Transfer Fee, were an indication of financial difficulties on the part of the Appellant. vii. There was no need for bank details to be provided, because these details had already been mentioned in all invoices sent by Flora. viii. Although EC Directive 2006/112 is related to VAT issues (which is not the case at stake), the Panel highlights the fact that Article 229 of this regulations restricts Member States from requiring signed invoices, by stating that “[m]ember States shall not require invoices to be signed.” 146. In view of the foregoing, the Panel finds that the Appellant did not disclose the information required under the UEFA Club Licensing Regulations, in particular Article 47 and the excuses given were irrelevant under the UEFA regulations and Swiss Law. Also the excuses under domestic Hungarian Law and the EC Directive are irrelevant and cannot sustain the Appellant´s reasons for concealing the relevant financial information. The debt to Flora was overdue and the Appellant’s attitude is not excusable. To the contrary, the Appellant´s attitude ought to be opposed because the Appellant tried to mislead UEFA with the information it provided so as to obtain the licence. b) Are the sanctions imposed in the appeal decision proportional? 147. Having found the Appellant guilty of breaching the UEFA Club Licensing Regulations, the Panel must now determine whether the sanctions imposed in the Appeal Decision are proportional. 148. The Appellant argues that the sanctions imposed in the Appeal Decision are harsh and have not followed past UEFA precedents, such as the UEFA decision in the PAOK case, and the recent decision issued in the Bursaspor case. 149. In assessing the sanctions, reference must be made to Article 56 of the UEFA Club Licensing Regulations, which, in order to ensure the protection of clubs as creditors, states that “[a]ny breach of these regulations may be penalised by UEFA in accordance with the UEFA Disciplinary Regulations.” 150. Article 17.1 of the UEFA Disciplinary Regulations states that “[t]he disciplinary body shall determine the type and extent of the disciplinary measures to be imposed, according to the objective and subjective elements, taking account of both aggravating and mitigating circumstances.” 151. Article 17.5 of the UEFA Disciplinary Regulations adds that “[i]f the party charged has committed multiple disciplinary offences, the disciplinary body assesses the sanction according to the most serious offence and increases it accordingly.” c.1) Is the fine proportional? 152. Pursuant to Article 14.2 of the UEFA Disciplinary Regulations, the non-monetary disciplinary measures which may be imposed against UEFA member associations and clubs for violating the UEFA regulations shall be “[a] fine (…) no less than EUR 100 and no more than EUR 1,000,000.” 153. It is therefore apparent from the above provision that a deciding body has a wide discretion when it comes to sanctioning, and account must be taken of any aggravating or mitigating circumstances. 154. The UEFA Appeals Body Decision fined the Appellant EUR 50,000, which in the Panel´s assessment was fairly and reasonably assessed and also based on the facts highlighted in paragraph 158 hereunder. c.2.) Is the suspension proportional? 155. Article 14.1 of the UEFA Disciplinary Regulations states as follows: “1 The following disciplinary measures may be imposed against member associations and clubs in accordance with Article 53 of the UEFA Statutes: a) warning, b) reprimand, c) fine, d) annulment of the result of a match, e) order that a match be replayed, f) deduction of points, g) awarding of a match by default, h) playing of a match behind closed doors, i) stadium closure, j) playing of a match in a third country, k) disqualification from competitions in progress and/or exclusion from future competitions, l) withdrawal of a title or award, m) withdrawal of a licence.” 156. It is clear from this provision that the least non-monetary sanction imposable is a warning, with the severest being a withdrawal of a license. 157. The Panel notes that the UEFA Appeals Body Decision has already reduced the initial suspension issued by the UEFA Disciplinary Decision in relation to the suspension by lowering it to a mere disqualification from the UEFA competition 2011-2012 and 2012-2013, and suspending the Appellant´s disqualification from the UEFA competition 2013-2014 for a probationary period. In practical terms, the Appellant has only been suspended for one season because it did not qualify for the 2011-2012 UEFA club competitions. 158. The Panel also considers the following acts and conduct of the Appellant which lacked transparency and diligence in weighing the proportionality of the suspension: a. the Appellant benefited by playing in the UEFA Europa League 2010-2011 club competition without disclosing the correct and true overdue payables it had. Had the Appellant disclosed the accurate information which would have enabled UEFA to assess whether to grant the license, the Club might not have received a UEFA license to take part in the 2010-2011 Europa League club competition. It might also not have received EUR 360,000 from UEFA for participating in the 2010-2011 UEFA Europa League club competition. b. the Appellant knew it had financial problems yet did not disclose this to UEFA. This is apparent from the Appellant´s request to Flora for an extension of the deadline for paying the first instalment of the Transfer Fee. c. the second instalment of the Transfer Fee was paid much later, after the 30 June 2009 deadline had expired, despite the Appellant having received the requested “original, stamped and signed” invoice. Moreover, this instalment was paid in 3 phases and completed on 17 November 2010. 159. The case laws invoked by the Appellant (Bursaspor case and the PAOK case) differ in terms of facts from the present appeal. Unlike in the two aforementioned cases, the Appellant committed two breaches; the first being the fact that it had overdue payables, and the second being its failure to disclose the correct and accurate payables. In addition to this, the Bursaspor case is not final and an appeal has been filed to the UEFA Appeals Body. 160. The Panel also underlines that the sanctions imposed were established within the discretionary powers of UEFA based on its assessment of the facts and circumstances of the case, and the Appellant has not convinced the Panel that such discretion was unreasonably exercised outside UEFA´s sanction range or that it was not in line with similar case decisions. 161. In view of the foregoing facts, the Panel is of the view that the Appellant has failed to prove that the sanction imposed in the Appeal Decision is disproportionate, or that the assessment of the UEFA Appeals Body diverted from previous decisions of similar facts and circumstances. The Panel has no justifiable grounds for modifying the sanctions imposed in the Appeal Decision. c.3.) Is the Appellant entitled to an exception from the UEFA Club Licensing Regulations? 162. The Appellant claims that Hungary is a relatively small and inexperienced football nation, ranked 27th by FIFA and 29th in the UEFA coefficient. It also states that as a club, Györi has only taken part in UEFA competitions on two occasions since 1987. It requests the CAS to consider Hungary´s territory, population, geography, and economic background in mitigation pursuant to Annex I (B). 6 (a) of the UEFA Club Licensing Regulations. It also wants an exception based on the “[n]on-applicability of a certain criterion defined in section IV due to national law or any other reason.”. 163. Pursuant to Article 4 of the UEFA Club Licensing Regulations, “(…) UEFA Administration may grant an exception to the provisions set out in these regulations within the limits set out in Annex I.” 164. It is clear from this provision that the decision on whether or not to grant a club any exception from the UEFA Club Licensing Regulations solely lies with the UEFA Administration on the basis of its discretion, and in order to benefit from any such exception, an applicant must file a clearly written and well founded exception request to the UEFA. (Cf Annex I Article B. 2 of the UEFA Club Licensing Regulations). 165. No application has been filed by the Appellant for such an exception. 166. In view of the above, the Appellant´s request for mitigation on the basis of Annex I (B) 6 (a) of the UEFA Club Licensing Regulations is dismissed. c) Conclusion 167. Considering all the facts, evidence and arguments adduced, the appeal is dismissed. VI. COSTS 168. (…) * * * * * * * * * * * * CAS 2012/A/2702 Györi ETO v. UEFA - p. 28 ON THESE GROUNDS The Court of Arbitration for Sport rules that: 1. The appeal filed by Györi ETO against the UEFA Appeals Body decision dated 29 November 2011 is dismissed. 2. The UEFA Appeals Body decision dated 29 November 2011 is upheld. 3. (…) Lausanne, 8 May 2012 The Court of Arbitration for Sport Rui Botica Santos President of the Panel Stuart McInnes Denis Oswald Arbitrator Arbitrator Felix Majani Ad hoc Clerk