F.I.F.A. – Commissione per lo Status dei Calciatori (2013-2014) – controversie tra società – ———- F.I.F.A. – Players’ Status Committee (2013-2014) – 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 10 December 2013, by Geoff Thompson (England) Single Judge of the Players’ Status Committee, on the claim presented by the club Club B, from country A as “Claimant” against the club Club M, from country O as “Respondent” regarding a contractual dispute arisen between the parties and relating to the player J.

F.I.F.A. - Commissione per lo Status dei Calciatori (2013-2014) – controversie tra società – ---------- F.I.F.A. - Players' Status Committee (2013-2014) – 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 10 December 2013, by Geoff Thompson (England) Single Judge of the Players’ Status Committee, on the claim presented by the club Club B, from country A as “Claimant” against the club Club M, from country O as “Respondent” regarding a contractual dispute arisen between the parties and relating to the player J. I. Facts of the case 1. On 26 January 2010, Club B, from country A (hereinafter: Claimant), Club M, from country O (hereinafter: Respondent) and the player J (hereinafter: the player) signed a transfer agreement (hereinafter: the agreement) regarding the transfer of the player to the Respondent, by means of which the Claimant was inter alia entitled to receive from the Respondent USD 500,000 as transfer fee. In addition, the agreement provided for the Claimant to receive from the Respondent 50 % of the compensation obtained by the latter in case of a subsequent transfer of the player to a third club until 31 December 2011. In this respect, the Respondent committed itself to consider any plausible offer of purchase of the player received, until 31 December 2011, as of USD 2,000,000 (art. 7 of the agreement) and was prohibited from loaning or transferring the player before 31 December 2011 without the Claimant’s approval (cf. art. 8 of the agreement). In case of non-compliance, the Respondent had to pay to the Claimant USD 2,000,000 as penalty (cf. art. 8 of the agreement). 2. In continuation, the agreement specified that the employment contract between the Respondent and the player (hereinafter: the employment contract) had to include a clause by means of which, in case of its early termination by the player without just cause, the latter would have to pay the amount of USD 2,000,000 as compensation, sum which will be then divided between the Respondent and the Claimant (cf. art. 9 of the agreement). 3. Finally, the agreement provided for the Respondent to pay USD 1,500,000 to the Claimant as compensation in case it would be responsible for the early termination of the employment contract (cf. 10 of the agreement). 4. In January 2011, the Respondent, Club L, from country P (hereinafter: Club L) and the player signed a loan agreement (hereinafter: the loan agreement) concerning the loan of the player to Club L for free until 31 December 2011. In this respect and in accordance with art. 4 of the loan agreement, Club L was prohibited from loaning or transferring the player before 31 December 2011 without the Respondent’s and the Claimant’s approval. In case of non-compliance, Club L had to pay to the Respondent and the Claimant each a penalty fee amounting to USD 2,000,000. In addition, the loan agreement, referring to the agreement, mentioned that the Claimant was entitled to receive 50% of the compensation obtained in case of a subsequent transfer of the player. In this regard, Club L undertook to consider any plausible offer received until 31 December 2011 as of USD 1,500,000 and to distribute the relevant amount in equal shares between the Claimant and the Respondent (cf. art. 6 of the loan agreement). 5. Finally, the loan agreement provided for the player and Club L to conclude an employment contract by means of which the player was entitled to receive from Club L, as remuneration, the amount of USD 400,000. In this respect, the Respondent undertook to comply with all tax, work and social security obligations related to the player. Furthermore, the employment contract between Club L and the player had to include a clause by means of which, in case of its early termination by the player without just cause, the latter would have to pay the amount of USD 2,000,000 as compensation, sum which will be then divided between the Respondent and the Claimant (cf. art. 10 of the loan agreement) and in case of early termination provoked by Club L, the latter would have to pay to the Respondent and the Claimant USD 1,500,000 each as compensation. 6. On 23 July 2012, the Claimant lodged a claim with FIFA against the Respondent requesting from the latter the payment of USD 2,000,000, corresponding to the fee as per art. 8 of the agreement, for having loaned the player to Club L without its consent. 7. In this respect the Claimant inter alia referred to an exchange of correspondence with the Respondent between January and October 2011. In this context, the Respondent had requested the Claimant’s approval to prematurely terminate the employment contract or to loan the player to Club L on 19 January 2011, while the Claimant had refused to give its consent on 20 January 2011 and informed the Respondent that should the latter terminate the player’s employment contract or dispose of the player’s right in any other way, it would claim “the penalty clause” under the agreement in full, i.e. USD 2,000,000. 8. In addition, the Claimant alleged that the Respondent, although asserting that no compensation had been paid in connection with the loan of the player, had received from Club L “20% of four players” in return. 9. Finally, the Claimant explained having been accused by the Respondent of having breached art. 18 bis of FIFA’s Regulations on the Status and Transfer of Players (hereinafter: the Regulations) by refusing to accept the loan of the player to Club L, an allegation vehemently denied by the Claimant which argued having only made use of its right as per the agreement. 10. In its response dated 6 January 2013, the Respondent rejected the Claimant’s claim in its entirety. 11. In this respect and to begin with, the Respondent alleged that it had been the player’s wish to go back to country P given his mediocre performances in country O as well as because of some “serious particular problems in his hometown.” In addition, the Respondent maintained that in order to facilitate the player’s move to country L, it had renounced to receive any compensation from Club L and had agreed on continuing to pay part of the player’s salary during the 2011 season so as to “maintain its original labour agreement until the end of 2011.” 12. In continuation, the Respondent referred to art. 8, 9 and 10 of the agreement (cf. par. 1, 2 and 3 above) and asserted that the relevant clauses revealed the intention of the parties to protect the Claimant’s “percentage in case of a new onerous transfer of the Player. In other words: 50% of the Player’s economic rights due to the Claimant should be preserved until 31 December 2011.” As a result, the Respondent deemed that by signing a loan agreement for free with Club L, the Claimant’s rights and especially “its percentage in the Player’s economic rights and the rights related to clause 8, 9 and 10 (..) were maintained (..) and also there was a good possibility of valorisation of the Claimant’s percentage.” Consequently, the Respondent held that, considering that it had not had any other choice but to facilitate the loan of the player to Club L, and taking into account that it had kept paying part of the latter’s salary as well as “preserved all the Claimant’s rights (..)” it would not be “legal or fair” to condemn it to pay the penalty fee. 13. Equally, the Respondent considered the amount of the penalty as per art. 8 of the agreement as being disproportionate as it corresponded to four times the amount originally due as transfer fee. 14. In addition to the above, the Respondent referred to art. 41 of the Swiss Code of Obligations and stressed that the Claimant had not suffered any damage. 15. Finally, the Respondent pointed out that in accordance with art. 18 bis of FIFA’s Regulations on the Status and Transfer of Players, the Claimant had not been entitled to interfere in its contractual relationship with the player by refusing to accept the loan to Club L. Therefore, the Respondent was of the opinion that the penalty clause had to be considered null and void. 16. Nevertheless and in case FIFA would accept the claim of the Claimant, the Respondent requested the reduction of the penalty fee to a maximum of USD 50,000, i.e. 10% of the transfer fee paid by the Respondent to the Claimant. II. Considerations of the Single Judge of the Players’ Status Committee 1. First of all, the Single Judge of the Players’ Status Committee (hereinafter also referred to as: the Single Judge) analysed whether he was competent to deal with 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 and 2012). Consequently, and since the present matter was submitted to FIFA on 23 July 2012, the Single Judge concluded that the 2008 edition of the Rules Governing the Procedures of the Players’ Status Committee and the Dispute Resolution Chamber (hereinafter: the Procedural Rules) is applicable to the matter at hand. 2. Furthermore, the Single Judge analysed which edition of the Regulations on the Status and Transfer of Players is 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 and 2012 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 with FIFA on 23 July 2012. In view of this, the Single Judge concluded that the 2010 edition of the Regulations on the Status and Transfer of Players (hereinafter: the Regulations) is applicable to the matter at hand as to the substance. 3. Subsequently, the Single Judge referred to art. 3 par. 1 and 2 of the Procedural Rules in connection with art. 23 par. 1 and 3 as well as art. 22 lit. f) of the 2012 edition of the Regulations on the Status and Transfer of Players and confirmed that he is competent to adjudicate on the present dispute between clubs affiliated to two different associations. 4. His competence and the applicable regulations having been established, and entering into the substance of the matter, the Single Judge started his analysis by acknowledging the facts of the case and the arguments of the parties as well as the documents contained in the file. 5. In doing so and to begin with, the Single Judge noted that that, on 26 January 2010, the Claimant and the Respondent had concluded a transfer agreement (hereinafter: the agreement) which, inter alia, included a sell on clause providing for the Claimant to receive from the Respondent 50 % of the compensation obtained by the latter in case of a subsequent transfer of the player to a third club until 31 December 2011. Furthermore, the Single Judge remarked that, in accordance with the agreement, the Respondent had to consider any plausible offer of purchase of the player received, until 31 December 2011, as of USD 2,000,000 (art. 7 of the agreement) and was prohibited from loaning or transferring the player before 31 December 2011 without the Claimant’s approval (cf. art. 8 of the agreement). In addition, the Single Judge noticed that, in case of non-compliance, the Respondent had to pay to the Claimant USD 2,000,000 as penalty (cf. art. 8 of the agreement; hereinafter: the penalty clause and the penalty fee respectively). 6. Besides, the Single Judge observed that, in January 2011, the Respondent had loaned the player to Club L, from country P for free, whereas the relevant loan agreement (hereinafter: the loan agreement) included a clause in accordance with which Club L was prohibited from loaning or transferring the player before 31 December 2011 without the Respondent’s and the Claimant’s approval. In addition, the Single Judge took note that as per the loan agreement, in case of non-compliance with such provision, Club L had to pay to the Respondent and the Claimant a penalty fee amounting to USD 2,000,000 each. Finally, the Single Judge noted that the loan agreement, which referred to the agreement, provided for the Claimant to receive 50% of the compensation obtained in case of a subsequent transfer of the player, whereas Club L undertook to consider any plausible offer received until 31 December 2011 as of USD 1,500,000 and to distribute the relevant amount in equal shares between the Claimant and the Respondent (cf. art. 6 of the loan agreement). 7. In continuation, the Single Judge took note that, in its claim to FIFA, the Claimant had requested from the Respondent the payment of the penalty fee arguing inter alia that the latter had loaned the player to Club L without its consent, thus breaching art. 8 of the agreement. Equally, the Single Judge observed that, for its part, the Respondent, although not denying that the loan agreement had been concluded without the Claimant’s approval, contested the latter’s entitlement to receive the penalty fee arguing, inter alia, that the Claimant’s economic interests had been preserved. 8. With the aforementioned considerations in mind and to begin with, the Single Judge recalled that in accordance with art. 8 of the agreement, the Respondent was clearly not allowed to loan or transfer the player before 31 December 2011 without the Claimant’s consent. Furthermore and in the same context, the Single Judge pointed out that it was undisputed that the player had been loaned to Club L in January 2011 without the Claimant’s permission. As a result, the Single Judge concluded that by loaning the player to Club L without the Claimant’s approval, the Respondent had breached art. 8 of the agreement. 9. Having established the aforementioned and as to the potential consequences of the relevant breach of contract committed by the Respondent, the Single Judge turned its attention to the content of the penalty clause and specified that, from his point of view, the purpose of the provision in question was to secure the value of the player and the sell-on rights of the Claimant until 31 December 2011. 10. In continuation and in the same context, the Single Judge was first of all eager to emphasize that notwithstanding the content of art. 7 and 8 of the agreement as well as regardless of the fact that the player had been loaned to Club L, there had never been any guarantee that the latter would de facto be transferred by the Respondent to a third club before 31 December 2011, allowing the Claimant to receive the sell on fee. Indeed, assuming that the player had not been loaned to Club L, the latter might as well have remained with the Respondent until the end of his employment contract without being transferred to a third club, in which case the Claimant would not have been entitled to receive a sell on fee. Hence, the Single Judge deemed that the Claimant had effectively not suffered any concrete damage as a result of the loan of the player to Club L, as it might none the less have never received the sell on fee, irrespectively of the loan of the player to Club L. 11. Equally and in the same context, the Single Judge recalled that the loan agreement included several provisions which seemed to have been inserted by the relevant parties with the aim of securing the Claimant’s rights in connection with the possibility of receiving the sell on fee in accordance with the agreement. As a consequence, the Single Judge considered that it had to be assumed that the Respondent, despite breaching art. 8 of the agreement, had undertaken what it deemed necessary in order to protect the sell-on rights of the Claimant. 12. Finally, the Single Judge believed that the loan on a free basis of the player to Club L did not result in either an increase or a decrease in the value of the latter’s services. 13. In view of all the above and in particular considering that the Claimant could not prove that it had sustained any concrete damage following the loan of the player to Club L, as well as taking into account that the Respondent had tried to secure the Claimant’s sell on rights in connection with a subsequent transfer of the player to a third club before 31 December 2011, the Single Judge established that the claim of the Claimant must be rejected. 14. 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 the proceedings before the Players’ Status Committee, including the Single Judge, costs in the maximum amount of currency of country H 25,000 are levied. 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). 15. In this respect, the Single Judge reiterated that the claim of the Claimant is rejected. Therefore, the Single Judge decided that the Claimant t has to bear the entire costs of the current proceedings in front of FIFA. 16. 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. Consequently and taking into account that the total amount at dispute in the present matter is above currency of country H 200,001, the Single Judge concluded that the maximum amount of costs of the proceedings corresponds to currency of country H 25,000. 17. In conclusion, and considering that the case at hand was adjudicated by the Single Judge and not by the Players’ Status Committee in corpore and that the present case did not show particular factual difficulties or specific legal complexities, the Single Judge determined the costs of the current proceedings to the amount of currency of country H 15,000. 18. Consequently, the Claimant has to pay the amount of currency of country H 15,000 in order to cover the costs of the present proceedings. III. Decision of the Single Judge of the Players’ Status Committee 1. The claim of the Claimant, Club B, is rejected. 2. The final costs of the proceedings in the amount of currency of country H 15,000 are to be paid by the Claimant, Club B. Considering that the Claimant, Club B, already paid the amount of currency of country H 5,000 as advance of costs, the latter has to pay the remaining amount of currency of country H 10,000 within 30 days as from the date of notification of the present decision to the following bank account with reference to case nr.: ***** Note relating to the motivated decision (legal remedy): According to article 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: info@tas-cas.org www.tas-cas.org For the Single Judge of the Players’ Status Committee Jérôme Valcke Secretary General Encl. CAS Directives