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 30 January 2012, by Geoff Thompson (England) Single Judge of the Players’ Status Committee, on the claim presented by the club Club A, from country B as Claimant against the club Club D, from country E as Respondent regarding a contractual dispute between the parties relating to the player Z

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 30 January 2012, by Geoff Thompson (England) Single Judge of the Players’ Status Committee, on the claim presented by the club Club A, from country B as Claimant against the club Club D, from country E as Respondent regarding a contractual dispute between the parties relating to the player Z I. Facts of the case 1. On 18 June 2009, the club Club A (hereinafter: Claimant) and the Club D (hereinafter: Respondent) concluded a transfer agreement for the transfer of the player Z (hereinafter: the player) from the Claimant to the Respondent. 2. The relevant financial terms of the above-mentioned transfer agreement are the following: “The transfer fee shall be EUR 300,000. The payment of the Transfer Fee shall be made in two instalments (…): The first instalment of EUR 150,000 shall be made upon 30 June 2009 at the latest. The second instalment of EUR 150,000 shall be made upon 12 October 2009 at the latest. (…) If the second instalment of EUR 150,000 has not been paid on 12 October 2009 at the latest, Club D shall be subject to pay a penalty fee of EUR 100,000. (…) If Club D were to loan and/or permanently transfer the Player to a third party, Club A shall have the right to receive 15% of the gross loan and/or transfer fee. Club A share of the loan and/or transfer fee shall be paid by Club D to Club A within 14 days upon the third party’s payment to Club D.” 3. On 26 November 2009, the Claimant lodged a claim in front of FIFA against the Respondent for breach of the transfer agreement indicating that the second payment had not been paid yet. Therefore, the Claimant requested the payment of the second installment in the amount of EUR 150,000 plus 5% interest as from the date the second installment was due as well as the payment of the penalty fee of EUR 100,000. 4. On 7 September 2010, the Claimant informed FIFA that, on 24 August 2010, the Respondent had paid the amount of EUR 135,000 to the Claimant. In this regard, the Claimant stressed that the Respondent had incorrectly deducted EUR 15,000 as solidarity contribution from the second installment and mentioned that, even if solidarity contribution was to be deducted from the transfer compensation, such solidarity contribution should have been exclusively paid to the Claimant, since the player was registered with the Claimant as from the age of nine. 5. During the proceedings, the Respondent submitted a copy of the loan agreement it had signed with Club G, from country E, dated 8 January 2010, which indicated that the Respondent and Club G had agreed upon the amount of 50,000 (currency of country E) for the loan of the player. 6. On account of all the above, the Claimant amended its claim and requested the Players’ Status Committee to order that the Respondent would pay to the Claimant: - the remaining part of the second installment, i.e. EUR 15,000 plus 5% interest as of 12 October 2009 until the full payment is made, - the penalty fee of EUR 100,000 plus 5% interest as of 12 October 2009 until the full payment is made, and - an amount corresponding to 15% of 50,000 (currency of country E). 7. In its reply to the claim lodged against it, the Respondent indicated that it had paid the second installment, minus the 5% corresponding to the solidarity contribution, too late, due to financial difficulties. However, the Respondent emphasized that it had now fulfilled its contractual obligations towards the Claimant. Therefore, the Respondent was of the view that the penalty clause was no longer enforceable and that the Claimant could only ask for “the default line, in line with ordinary interest rates”. In support of the foregoing, the Respondent asserted that the objective of a penalty clause is to secure due performance of a contract and not to take advantage of the financial situation of the Respondent. 8. Moreover, the Respondent asserted that a penalty fee of EUR 100,000 cannot be valid when the corresponding payment amounts to EUR 150,000 and that, according to article 163 (I) of the Swiss Code of Obligations, a penalty clause agreed upon between the parties can be mitigated if it is excessive. Therefore, according to the Respondent, if the penalty clause would not be declared invalid, the amount agreed upon in the penalty clause should be mitigated and in doing so “it should be taken into account the criterion of whether the amount stipulated at the penalty clause is truly liquidated damages or the asses of probable or possible interest in the payment in question on time, which is none in this case”. 9. The Respondent further stated that it was not disputed that the parties had agreed upon a sell-on clause in case that the player would be transferred to a third club. 10. In its duplica, the Claimant maintained its previous position and stated it wished to make a “conditional adjustment” in case the Players’ Status Committee would come to the conclusion that the amount of EUR 15,000 is indeed to be considered as solidarity contribution. If so, the Claimant is of the opinion that the Respondent is only entitled to deduct EUR 7,500, corresponding to 5% of the second instalment. Therefore, the Claimant further amended its claim and requested the Respondent to pay EUR 7,500 as well as interest on the amount with a yearly rate of 5% as of 12 October 2009. 11. In its final position, the Respondent maintained its previous position. II. Considerations of the Single Judge of the Players’ Status Committee 1. First of all, the Single Judge of the Players’ Status Committee (hereinafter: the Single Judge) analysed which Procedural Rules were applicable to the matter at hand. In this respect, he referred to art. 21 par. 2 and 3 of the Rules Governing the Procedures of the Players’ Status Committee and the Dispute Resolution Chamber (edition 2008; hereinafter: the Procedural Rules) as well as to the fact that the present matter was submitted to FIFA on 26 November 2009, thus after 1 July 2008. Therefore, the Single Judge concluded that the 2008 edition of the Procedural Rules is applicable to the matter at hand. 2. Subsequently, the Single Judge analysed which edition of the Regulations on the Status and Transfer of Players was 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 edition of the Regulations on the Status and Transfer of Players and, on the other hand, to the fact that the claim was lodged in front of FIFA on 26 November 2009. In view of the foregoing, the Single Judge concluded that the 2009 edition of the FIFA Regulations on the Status and Transfer of Players (hereinafter: the Regulations) is applicable to the case at hand as to the substance. 3. Furthermore, the Single Judge confirmed that, on the basis of art. 3 par. 1 of the Procedural Rules in connection with art. 23 par. 1 and 3 as well as art. 22 lit. f) of the Regulations, he was competent to deal with the present matter since it concerned a dispute between two clubs affiliated to two different associations. 4. The competence of the Single Judge 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 the documentation submitted by the parties. 5. First of all, the Single Judge acknowledged that it was undisputed between the parties that, on 18 June 2009, a transfer agreement was concluded relating to the transfer of the player from the Claimant to the Respondent for a transfer compensation amounting to EUR 300,000 to be paid by the Respondent to the Claimant. Equally, the Single Judge acknowledged that it was undisputed that the Claimant and the Respondent had agreed upon a sellon clause, by means of which the Claimant would be entitled to receive 15% of any loan and/or transfer compensation received by the Respondent in case of a future transfer of the player. 6. Furthermore, the Single Judge noted that it was also undisputed that the Respondent had paid the amount of EUR 135,000 to the Claimant on 24 August 2010 and that the player was loaned from the Respondent to Club G, from country E for the amount of 50,000 (currency of country E). 7. Moreover, the Single Judge took note of the penalty clause contained in the transfer agreement which stipulated that “If the second instalment of EUR 150,000 has not been paid on 12 October 2009 at the latest, [the Respondent] shall be subject to pay a penalty fee of EUR 100,000”. 8. With due consideration to the above, the Single Judge went on to examine the positions of both parties in the present dispute. In this respect, he firstly noted that the Claimant requested the payment of the amount of EUR 15,000, corresponding to the remaining part of the second instalment as per agreement plus interest at the rate of 5%, the payment of the penalty fee of EUR 100,000 plus interest at the rate of 5% as well as the payment of an amount corresponding to 15% of the compensation agreed upon between the Respondent and Club G, from country E in connection with the loan of the player. 9. Secondly, the Single Judge observed that the Respondent disputed the payment of the amount of EUR 15,000 to the Claimant outlining that it had retained 5% of the EUR 300,000 as solidarity contribution in accordance with art. 1 of Annexe 5 of the Regulations. In addition, the Single Judge noted that the Respondent deemed that the penalty clause in the agreement was excessive and, therefore, requested that said penalty clause was declared invalid or, in the alternative, that the amount stipulated in the penalty clause would be mitigated. 10. After having carefully examined the parties’ positions, the Single Judge started by addressing the issue regarding the alleged outstanding payment of EUR 15,000 in connection with the payment of the second instalment. By way of explanation, the Single Judge pointed out that, as established in art. 21 in connection with art. 1 of Annexe 5 of the Regulations, if a professional moves during the course of a contract, 5% of any compensation, not including training compensation paid to his former club, shall be deducted from the total amount of this compensation and distributed by the new club as a solidarity contribution to the club(s) involved in his training and education over the years. 11. In this respect, the Single Judge referred to art. 12 par. 3 of the Procedural Rules which stipulates that any party claiming a right on the basis of an alleged fact shall carry the burden of proof and noted that the Respondent had not provided any documentary evidence that it had indeed distributed 5% of the transfer compensation it had agreed upon with the Claimant to the club(s) involved in the player’s training and education over the years. In this context, the Single Judge considered that it is clearly not the purpose of the provisions regarding solidarity contribution that the new club, i.e. the Respondent, can simply retain 5% of the transfer compensation without distributing said 5% to the clubs involved in the training and education of the player. Equally, the Single Judge noted that the Respondent had not proven that there was any other training club than the Claimant. Taking into account all the foregoing, the Single Judge considered that the Respondent could not enrich itself by retaining 5% of the transfer compensation without distributing such percentage as solidarity contribution to the club(s) involved in the training and education of the player. 12. In view of the above, the Single Judge concluded that the Respondent could not provide any evidence that it had in fact distributed the 5% of the relevant transfer compensation to the club(s) involved in the player’s training and education and decided to reject this argument of the Respondent. Consequently, the Single Judge decided that the Respondent was liable to pay to the Claimant the amount of EUR 15,000, plus default interest of 5% p.a. as from 25 August 2010 until the date of effective payment. 13. Turning his attention to the argumentation put forward by the parties in relation to the penalty clause, the Single Judge took, once more, note of the fact that, according to the transfer agreement concluded between the parties, the Respondent was supposed to pay a penalty fee of EUR 100,000 to the Claimant in case that the payment of the amount of EUR 150,000, corresponding to the second installment, was paid after 12 October 2009. In other words, according to the transfer agreement, in the case of late payment, the Respondent would need to pay a penalty fee to the Claimant pertaining to approximately 2/3 of the corresponding payment. 14. In view of the foregoing, the Single Judge considered that the penalty clause was clearly disproportional and decided that, as an alternative and in accordance with the longstanding practice of the Players’ Status Committee, the Respondent has to pay 5% default interest over the amount paid late. Consequently, the Single Judge decided that the Respondent is liable to pay to the Claimant default interest of 5% p.a. on the amount of EUR 150,000, as from 13 October 2009 until 24 August 2010, i.e. the date on which the payment of the amount of EUR 135,000 was made. 15. As to the sell-on clause agreed upon in the transfer agreement between the Claimant and the Respondent, the Single Judge recalled that the Respondent recognized that an amount corresponding to the subsequent transfer of the player was due to the Claimant. Therefore, the Single Judge, and hereby considering that the Respondent and Club G, from country E had agreed upon a loan compensation amounting to currency of country E 50,000 as well as that the Claimant was entitled to receive 15% as per agreement, established that the Respondent was liable to pay to the Claimant the amount of currency of country E 7,500. 16. In conclusion, the Single Judge decided to partially accept the claim of the Claimant and, consequently, ruled that the Respondent was liable to pay to the Claimant the amount of currency of country E 7,500, the amount of EUR 15,000 plus default interest of 5% p.a. as from 25 August 2010 until the date of effective payment as well as default interest of 5% p.a. on the amount of EUR 150,000 as from 13 October 2009 until 24 August 2010. 17. Lastly, the Single Judge referred to art. 25 par. 2 of the Regulations in combination with art. 18 par. 1 of the Procedural Rules, according to which, in proceedings before the Players’ Status Committee including its Single Judge, costs in the maximum amount of CHF 25’000 are levied. The relevant provision further states that the costs are to be borne in consideration of the parties’ degree of success in the proceedings (cf. art. 18 par. 1 of the Procedural Rules). 18. In respect of the above, and taking into account that the claim of the Claimant had only been partially accepted, the Single Judge concluded that both the Claimant and the Respondent have to bear a part of the costs of the current proceedings before FIFA. 19. Furthermore and according to Annexe A of the Procedural Rules, the costs of the proceedings are to be levied on the basis of the amount in dispute. On that basis, the Single Judge held that the amount to be taken into consideration in the present proceedings is EUR 150,000. Consequently, the Single Judge concluded that the maximum amount of costs of the proceedings corresponds to CHF 15,000. 20. In conclusion, and considering that the case at hand did not pose any particular factual difficulties and was adjudicated by the Single Judge and not by the Players’ Status Committee in corpore, the Single Judge determined the costs of the current proceedings to the amount of CHF 10,000. Furthermore, and in line with his aforementioned considerations and taking into account the degree of success, the Single Judge of the Players’ Status Committee decided that the amount of CHF 1,000 has to be paid by the Claimant and the amount of CHF 9,000 by the Respondent. III. Decision of the Single Judge of the Players’ Status Committee 1. The claim of the Claimant, Club A, is partially accepted. 2. The Respondent, Club D, has to pay to the Claimant the amounts of EUR 15,000 and currency of country E 7,500 within 30 days as from the date of notification of this decision. 3. Within the same time limit, the Respondent has to pay to the Claimant default interest of 5% p.a. as follows: - on the amount of EUR 150,000, as from 13 October 2009 until 24 August 2010; - on the amount of EUR 15,000, as from 25 August 2010 until the date of effective payment. 4. If the aforementioned sums plus interest are not paid within the aforementioned deadline, the present matter shall be submitted, upon request, to FIFA’s Disciplinary Committee for consideration and a formal decision. 5. Any further claims lodged by the Claimant are rejected. 6. The final amount of costs of the proceedings, amounting to CHF 10,000, are to be paid within 30 days as from the date of notification of the present decision as follows: 6.1. CHF 5,000 by the Respondent to FIFA to the following bank account with reference to case no. rov XX-XXXXX: 6.2. CHF 4,000 by the Respondent to the Claimant. 6.3. CHF 1,000 by the Claimant to FIFA. Given that the Claimant has already paid the amount of CHF 5,000 as advance of costs at the start of the present proceedings, the Claimant is exempted from paying the abovementioned costs of the proceedings. 7. The Claimant is directed to inform the Respondent directly and immediately of the account number to which the remittances are to be made in accordance with the above points 2., 3. and 6.2. and to notify the Players’ Status Committee of every payment received. Note relating to the motivated decision (legal remedy): According to article 63 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: info@tas-cas.org www.tas-cas.org For the Single Judge of the Players’ Status Committee: Jérôme Valcke Secretary General Encl. CAS Directives