F.I.F.A. – Commissione per lo Status dei Calciatori (2011-2012) – controversie tra società – ———- F.I.F.A. – Players’ Status Committee (2011-2012) – club vs. club disputes – official version by www.fifa.com – Decision of the Single Judge of the Players´ Status Committee passed in Zurich, Switzerland, on 24 April 2012, by Geoff Thompson (England) Single Judge of the Players’ Status Committee, on the claim presented by the club, X, as “Claimant” against the club Z, as “Respondent” regarding a contractual dispute between the parties and relating to the player D.
F.I.F.A. - Commissione per lo Status dei Calciatori (2011-2012) – controversie tra società – ---------- F.I.F.A. - Players' Status Committee (2011-2012) – club vs. club disputes – official version by www.fifa.com – Decision of the Single Judge of the Players´ Status Committee passed in Zurich, Switzerland, on 24 April 2012, by Geoff Thompson (England) Single Judge of the Players’ Status Committee, on the claim presented by the club, X, as “Claimant” against the club Z, as “Respondent” regarding a contractual dispute between the parties and relating to the player D. I. Facts of the case 1. On 13 January 2004, Club Z (hereinafter: “the Respondent”) signed a transfer agreement (hereinafter: “the agreement”) with the company “the Company”, referred to as “The Company-The Club X” in the agreement, for the player D (hereinafter: “the player”). • Point I of the agreement established that “The Company-The Club X” had obtained, through a court ruling, the management, operation, commercialisation and administration, i.e. the freedom and autonomy to manage the footballing activity of the country A club, Club X (hereinafter “the Claimant”). • Point III of the agreement established that in compliance with the regulations of FIFA and of the Football Association A contracts registry, the Claimant would hold the “rights” of any player in its football teams. • Point VIII of the agreement established that the Respondent had verified that the company “The Company” (hereinafter: “the Company”), as administrator of the Claimant’s footballing activity, had the full power to transfer the player. • Art. 4 of the agreement established that the Respondent would pay “The Company-The Club X” the sum of EUR 1,602,500 for transferring “all of the federative rights and 75% of the economic rights” of the player to the Respondent. • Art. 5 of the agreement established that the transfer compensation mentioned in art. 4 and any future sum that the Respondent would have to pay on the basis of the agreement would be paid into the bank account of the Company. • Art. 7 par. b) of the agreement established that “The Company-The Club X” would be given priority if the same financial conditions were offered for the player’s services by interested third parties. • Art. 7 par. c) of the agreement stipulated that if “The Company-The Club X” did not exercise that priority (cf. art. 7 par. b) of the agreement), the Respondent would pay to it 25% as “economic rights” of the sum the Respondent agreed with the player’s new club. 2. On 1 June 2004, the Respondent issued a document entitled “Declaration” in which it confirmed that it had signed the agreement with the Company for the transfer of the player and stated that in case the player was transferred to a new club, it would expressly and irrevocably pay to the Company 25% of the transfer fee in question. 3. On 31 October 2007, the Company, as “manager” of the Claimant, filed a claim in front of FIFA against the Respondent, requesting payment of the sum of EUR 1,250,000, representing 25% of EUR 5,000,000 paid for the subsequent transfer of the player to the country S club R (hereinafter: “club R”), in accordance with art. 7 par. c) of the agreement, plus costs and annual interest of 5% calculated as from 19 June 2007. In support of its claim, the Company submitted a notice from the 4. Football Federation S, which in turn enclosed confirmation from its affiliate Club R (both of which were sent as part of a solidarity contribution claim it had filed with FIFA and which stated that Club R had exercised the option for the permanent transfer of the player and had informed the Respondent of this on 20 November 2006) that the sum of EUR 5,000,000 was paid on 19 June 2007. 5. In this respect, the Company stated that: a) It had obtained the management of the Claimant through a court ruling and, consequently, the Claimant and the Company made up a single unit for the purposes of managing the Claimant’s footballing activity. In this context, the Company argued that the Court of Arbitration for Sport (CAS) had ruled in a similar case, namely CAS 2004/X/XXX club E v club A, that a particular administrative company was considered an extension of the notion of an affiliated club, and not a separate company; b) The Respondent had paid the Company the sum of EUR 1,602,500 for 75% of the “economic rights” when the player was transferred, with the Company maintaining the right to receive the remaining 25% as a ”sell-on clause” in the event of a new transfer of the player; c) The Respondent had transferred the player “on loan” to Club R for a sum of EUR 2,000,000 for two seasons with the option of a permanent transfer for EUR 5,000,000, which had been exercised by Club R on 19 June 2007. 6. Upon FIFA´s request for position, the Respondent stated on 10 June 2009 that the entire claim should be rejected, highlighting in particular that: a) The Claimant had gone bankrupt in 2001 and its administration had been handed over to the Company through a court ruling; b) Even if the Claimant had been entitled to initiate proceedings against the Respondent, the claim should have been filed with the judge in charge of the bankruptcy hearing and not with FIFA; c) The Company was in charge of its administration and was a private company. As a result, the claim in question should be rejected as the Company was not legally entitled to file a claim with FIFA; d) The declaration was concluded with the Company and did not contain any acknowledgement of debt owed to the Claimant, nor did it mention the latter; e) The Company had gone bankrupt and as proof of this, a copy of the “Bankruptcy decree” dated 4 July 2008 was enclosed, which was why the Company did not have the legitimacy to file the present claim. 6. On 13 October 2009, the Claimant informed FIFA that the Company was no longer its administrator and that it had recovered its institutional activities. Therefore, the Claimant argued that it should legitimately be entitled to substitute the Company as claimant in the present matter. Consequently, the Claimant presented its reaction to the position of the Respondent and pointed out, in particular, that: a) The Respondent had acknowledged the validity of both the agreement and the declaration. In the declaration, it had specifically acknowledged the 25% it owed to the Company and it was obvious that the declaration was conditional on and subject to the terms of the agreement; b) The Company had signed the agreement and the declaration in its capacity as administrator acting on behalf of the Claimant at all times and never on its own behalf. Only football clubs are part of the “organisation of FIFA” and as a private company, the Company could never have entered into an employment contract with any player; c) The “rights” in connection with the transfer of the player stemmed from the employment contract drawn up between the latter and the Claimant, during the term of which the Company was appointed administrator. Therefore, there was no doubt that the Claimant was the sole holder of these “rights” and ultimately the party entitled to receive the sell-on fee. 7. On 12 August 2010, the Respondent categorically rejected the reaction of the Claimant, maintaining that: a) The case had been initiated by the Company, after which the Claimant had written to FIFA claiming that the administration contract with the Company had been terminated without submitting any evidence of that. The Claimant’s claim to have automatically replaced the original claimant (i.e. the Company) was solely based on allegations and was legally illegitimate; b) The Company had gone bankrupt and had claims pending against the Claimant and according to press reports, during the course of their relationship, the “economic rights” of players had been split 80% for the Company and 20% for the Claimant. 8. On 29 November 2010, the FIFA administration requested the Football Association A to provide information on the issues raised by the Respondent, particularly concerning the relationship between the Claimant and the Company. 9. On 3 February 2011, the Football Association A, referring to the relationship the Claimant had with the Company at the time, explained that as a general rule, this kind of “management relationship” stemmed from a fixed-term contractual tie during which a private company helped a club in financial difficulty, providing assistance in order to improve the situation of the said club in return for periodic payments or shares in profits generated by the club. The Football Association A added that in this kind of relationship, the club maintained full ownership of the “rights and property” which made up its assets as well as the legitimacy to claim its “rights” and answer to its obligations. 10. The Football Association A further explained that on 29 December 2000, the Claimant had signed a management contract with the Company which had been terminated by a court ruling on 3 June 2008. During that period of management (8 years), the Claimant had competed without interruption, completing all corresponding acts as a club. 11. On 4 February 2011, the Claimant submitted another correspondence to FIFA in which it stated that: a) The Respondent had signed all of the documents with the same party, the Claimant, which had temporarily been under the Company’s administration at that time. Therefore, the Respondent could not allege that both agreements had been concluded between different parties or that the Claimant had not been mentioned; b) The Claimant had never interrupted its activities as football club and had remained affiliated to the Football Association A; c) The Respondent had only paid part of the transfer sum agreed upon in the agreement (EUR 1,602,500), reason for which The Company-The Club X had lodged at the time a claim in front of FIFA who had ordered the Respondent, on 13 April 2005, to pay The Company-The Club X the sum of EUR 700,000. In light of the legal principle of “venire contra factum proprium non valet”, the Respondent should not be allowed to contest the relationship between Club X and The Company when it had not contested it during the aforementioned proceedings. 12. On 14 April 2011, the Respondent submitted its final statement, maintaining that: a) It was unquestionable that the “economic rights” of the players belonged to the Claimant even during the period the Company had been in charge of the administration; b) However, the case had originally been opened by the Company, alleging that it held 25% of the “rights” of the player in return for the services it had provided to the Claimant, and that such a claim was separate from the transfer of the player from the Claimant to the Respondent; c) There was a conflicting legal relationship between these two entities, where the Company was the creditor and the Claimant the debtor. The Claimant’s unjustified intervention was just an attempt to sidestep legal issues currently being debated before the country A authorities and until such authorities determined who held the “economic rights” to the player, the Respondent could be at risk of being the object of the same claim filed by two different parties. II. Considerations of the Single Judge of the Players’ Status Committee 1. First of all, the Single Judge of the Players’ Status Committee (hereafter also referred to as: “the Single Judge”) analysed whether he was competent to deal with the matter at hand. In this respect, the Single Judge confirmed that, on the basis of art. 3 par. 1 of the 2008 edition of the Rules governing the procedures of the Players’ Status Committee and the Dispute Resolution Chamber in connection with art. 23 par. 1 and 3 as well as art. 22 f) of the 2010 edition of the Regulations on the Status and Transfer of Players, he was competent to deal with the present matter since it concerned a dispute between two clubs affiliated to different associations. 2. Furthermore, the Single Judge analysed which Procedural Rules are applicable to the matter at hand. In this respect, he referred to art. 21 par. 2 and 3 of the 2008 edition of the Rules governing the procedures of the Players’ Status Committee and the Dispute Resolution Chamber. Consequently, and since the present matter was submitted to FIFA on 31 October 2007, the Single Judge concluded that the 2005 edition of the Rules Governing the Procedures of the Players’ Status Committee and the Dispute Resolution Chamber (hereinafter: “the Procedural Rules”) are applicable to the matter at hand (cf. art. 18 par. 1 and 2 of the Procedural Rules). 3. Subsequently, the Single Judge analysed which edition of the Regulations on the Status and Transfer of Players should be applicable as to the substance of the matter. In this respect, he referred, on the one hand, to art. 26 par. 1 and 2 of the 2010, 2009, and 2008 editions of the Regulations on the Status and Transfer of Players and, on the other hand, to the fact that the present claim was lodged in front of FIFA on 31 October 2007. In view of the foregoing, the Single Judge concluded that the 2005 edition of the FIFA Regulations for the Status and Transfer of Players (hereinafter: “the Regulations”) is applicable to the case at hand as to the substance. 4. His competence and the applicable regulations having been established, and entering into the substance of the matter, the Single Judge started by acknowledging the above-mentioned facts as well as the arguments and allegations raised by the parties during the proceedings. 5. In doing so and first of all, the Single Judge remarked that on 13 January 2004, the Respondent and the Company (i.e. “the Company”) concluded the agreement involving the payment of a transfer amount of EUR 1,602,500 in return for the acquisition by the Respondent of 75% of the “economical rights” of the player. 6. Moreover, the Single Judge took note that the agreement also provided in its art. 7 par. c) that the Respondent assumed the obligation to pay to the Company the remaining 25% of the “economic rights” of the player in the event that he was subsequently transferred to another club. 7. For the sake of good order, the Single Judge was keen to emphasise that the so- called “economic rights” is a term that has become obsolete since the entry into force of the 2001 edition of the Regulations for the Status and Transfer of Players, when it was replaced by the principle of maintenance of contractual stability between the contracting parties, i.e. professional players and football clubs. 8. In continuation, the Single Judge underlined that, following the transfer of the player from the Respondent to the Club R for an amount of EUR 5,000,000, the Company had lodged the present claim in front of FIFA on 31 October 2007, claiming from the Respondent the amount of EUR 1,250,000 as sell-on-fee (25% of the new transfer amount) on the basis of art. 7 par c) of the agreement it had concluded with the latter. 9. At this stage, the Single Judge pointed out that the parties disagreed as to who should have had the right or standing to claim from the Respondent in front of FIFA the amount as sell-on fee stipulated in art. 7 c) of the agreement. In this respect, the Single Judge noted, on the one hand, that the Company had first lodged the abovementioned claim in front of FIFA and that, later on, the Claimant had argued that, since the Company was no longer its administrator, it should be considered as the legitimate claimant in the present matter. 10. The Single Judge then took note that, on the other hand, the Respondent had alleged that since it had concluded the agreement with the Company and not with the Claimant, any amount due under art. 7 c) of the agreement should exclusively be paid to the Company. This said, the Respondent had also argued that, taking into account that private companies cannot be legitimate parties in front of FIFA, the present claim should therefore be rejected. 11. In view of the above, the Single Judge focused his attention to the content of the agreement. After an exhaustive analysis of it, the Single Judge was eager to emphasise that the parties to the agreement were clearly identified at the beginning of the cited document as “Club Z and “The Company”. Moreover, the Single Judge noted that in point I of the agreement, a clear distinction between the Company and the Claimant was made. Besides, the Single Judge underlined that the agreement was signed by the Company´s Vice-president, the Respondent´s President and the player and not by the Claimant itself. 12. Furthermore, the Single Judge remarked that the distinction between the relevant legal entities was also explained by the Football Association A in its letter dated 3 February 2011 in which it was mentioned that the Company and the Claimant had signed on 29 December 2000 a “management contract” which had been terminated through a court ruling on 3 June 2008. Moreover, the Single Judge remarked that this distinction was also confirmed by the Claimant itself when it stated in front of FIFA that the Company was no longer its administrator and that the Claimant had recovered its institutional activities. 13. In addition, the Single Judge noted that in art. 5 of the agreement it was clearly defined that the Respondent would make all the payments pursuant to the agreement directly to the bank account of the Company, which was also mentioned in the article in question. 14. In view of all the above, the Single Judge concluded that the Claimant and the Company were clearly two different entities and that, most relevantly, the agreement on which the present claim is based was concluded between the Respondent and the Company only and, consequently, the Claimant was not a party to it. 15. In continuation, the Single Judge pointed out that the jurisdiction of FIFA’s decision-making bodies is limited to legal subjects enumerated in art. 6 par. 1 of the Procedural Rules, i.e. member associations, clubs, players, coaches as well as licensed players´ and match agents, and that consequently, FIFA is not competent to pass decisions in claims lodged by other entities. 16. Having established the aforementioned, and taking into account, in particular, that the agreement at the centre of the present dispute was concluded between the Respondent and the Company and not, as established above, between the Respondent and the Claimant, the Single concluded that the claim of the Claimant has to be rejected since the latter was not a party to the said agreement and that, therefore, there is no contractual basis for its claim to succeed. 17. Finally and for the sake of good order, the Single Judge focused his attention to the Claimant´s assertion that, at the time of a previous proceeding in front of FIFA for payment of the transfer amount based on the same agreement, the Respondent had not contested the relationship between the Claimant and the Company. In this respect, the Single Judge deemed appropriate to point out that during the investigation in question, which led to a decision adopted by the Single Judge of the Players’ Status Committee on 13 April 2005, no party had contested the legitimacy of the Claimant to lodge the cited claim in front of FIFA and that such an issue was therefore not raised at the time. 18. In this context, the Single Judge was keen to emphasise that since the entry into force of the 2008 edition of the Regulations on the Status and Transfer of Players, FIFA has paid increased attention to questions of third parties influence on football clubs (cf. art. 18 bis of the 2008 edition of the Regulations on the Status and Transfer of Players). 19. Lastly, the Single Judge referred to art. 25 par. 2 of the Regulations in combination with art. 15 par. 1 of the Procedural Rules, according to which in the proceedings before the Players´ Status Committee (including its Single Judge) costs in the maximum amount of CHF 25,000 are levied. The costs are to be borne in consideration of the parties´ degree of success in the proceedings and are normally to be paid by the unsuccessful party. However, in special circumstances, the costs may be assumed by FIFA. 20. According to Annex A of the Procedural Rules, the Single Judge observed that the costs of the proceedings are to be levied on the basis of the amount in dispute. The amount in dispute to be taken into consideration in the present proceedings is above CHF 200,000. Therefore, the Single Judge concluded that the maximum amount of costs of the proceedings corresponds to CHF 25,000 (cf. table in Annex A). 21. In this regard, the Single Judge reiterated that the Claimant’s claim is rejected and in light of the particularities of the present matter, decided that FIFA bears the costs of the current proceedings. III. Decision of the Single Judge of the Players´ Status Committee 1. The claim of the Claimant, Club X, is rejected. 2. No costs shall be charged to the Claimant, Club X, based on art. 15 par. 1 of the Rules Governing the Procedures of the Players’ Status Committee and the Dispute Resolution Chamber. Note relating to the motivated decision (legal remedy): According to art. 67 par. 1 of the FIFA Statutes, this decision may be appealed against before the Court of Arbitration for Sport (CAS). The statement of appeal must be sent to the CAS directly within 21 days of receipt of notification of this decision and shall contain all the elements in accordance with point 2 of the directives issued by the CAS, a copy of which we enclose hereto. Within another 10 days following the expiry of the time limit for filing the statement of appeal, the appellant shall file a brief stating the facts and legal arguments giving rise to the appeal with the CAS (cf. point 4 of the directives). The full address and contact numbers of the CAS are the following: Court of Arbitration for Sport Avenue de Beaumont 2 1012 Lausanne Switzerland Tel: +41 21 613 50 00 Fax: +41 21 613 50 01 e-mail: firstname.lastname@example.org www.tas-cas.org For the Single Judge of the Players´ Status Committee: Jérôme Valcke Secretary General Encl: CAS Directives