F.I.F.A. – Players’ Status Committee / Commissione per lo Status dei Calciatori – club vs club disputes / controversie tra società – (2020-2021) – fifa.com – atto non ufficiale – Decision 15 December 2020

Decision of the

Bureau of the Players’ Status Committee

passed by way of circulars, on 15 December 2020,

regarding a dispute concerning the transfer of the player Ante PALAVERSA

COMPOSITION:

Raymond Hack (South Africa), Chairman

José Luis Andrade (Portugal), member

Roy Vermeer (Netherlands), member

CLAIMANT:

KV Oostende, Belgium

Represented by Mr Thomas Verstraete

RESPONDENT:

Manchester City FC, England

I. FACTS

1. On 4 July 2019, the Claimant and the Respondent (hereinafter jointly referred to as the parties) signed a transfer agreement for the temporary transfer of the player Ante Palaversa (hereinafter: the player).

2. According to the provisions of the transfer agreement, the parties agreed that the transfer fee of USD 250,000 (cf. see above) would be payable in two equal instalments, as follows:

a) EUR 112,500, payable on 15 July 2019;

b) EUR 112,500, payable on 1 February 2020.

3. On 5 August 2019, the Claimant put the Respondent in default requesting the amount of EUR 112,500. Having said this, the Claimant submitted an invoice numbered 1970002.

4. Subsequently, on 5 December 2019, the Claimant reiterated its request.

5. On 22 January 2020, the Respondent replied maintaining that it had already made two payments on 6 and 12 September 2019, respectively. As regards the first payment (hereinafter: Payment 1), the Respondent indicated that the amount of EUR 112,500 was paid on 6 September 2019 and allegedly deposited in the Central Bank of savings (Finland) IBAN: FI9541080011367169 SWIFT: ITELFIHH.

6. According to the Respondent, on 12 September 2019, it was subsequently informed by the Claimant that the aforementioned bank account “had been closed” and that the payment of the first instalment should “be made instead to another designated Oostende account”.

7. In view of the above, taking into account that the first payment was made to an allegedly closed bank account, the Respondent “expected Payment 1 to be automatically remitted back to Manchester City […] Therefore, Manchester City made Payment 2 to the second Oostende account details”. Thus, on 12 September 2019, the Respondent allegedly paid the amount of EUR 112,500 and deposited it in the Pohjola Bank plc (Finland) IBAN: FI2957008120498691 SWFT: OKOYFIHH (hereinafter: Payment 2).

8. Notwithstanding the above, as per the Respondent, on 16 September 2019, its bank informed it that “the Central Bank of Savings, Finland, were unable to return Payment 1 as the funds had been confiscated by the local Police”.

9. The Respondent further sustained that it was “subsequently contacted on 2 October 2019 […] by [the Claimant] stating that [its] email had been hacked, and that the matter had been reported by [the Claimant] to the police”.

10. In this context, the Respondent pointed out that “until any funds were reimbursed back to Manchester City […] no further payments were to be made by [the Respondent] to [the Claimant]”.

11. In reply to the Respondent’s correspondence, on 2 January 2020, the Claimant stated the following: “it has come to our attention that your club has likely been victim of fraud and [the Respondent] already paid both instalments on an account that does not belong to our club. If you club needs assistance on this matter, please do not hesitate to contact us. Our club is of course willing to lend its fullest cooperation and provide you with the requested documentation for the judicial investigation”

12. Notwithstanding the above, the Claimant further wished to emphasize that the first instalment of the transfer fee remained outstanding.

13. Subsequently, by means of a further letter addressed to the Respondent on 4 February 2020, the Claimant maintained that it “has never requested to pay the development fee on a different bank account that the one indicated in the original invoice”. In this respect, the Claimant pointed out that “if [the Respondent] were to compare the two new invoices alongside the invoice that [the Respondent] already received, it would certainly have noticed that these invoices were tampered with. The bank account number of [the Claimant] was deleted and other bank details were mentioned on the forged invoices”.

14. Additionally, the Claimant sustained that “after receiving such a strange request [the Respondent] did not contact any of [the Claimant’s] representatives despite the fact that before signing the Loan Agreement [the parties] were actively negotiating by the phone”.

15. Having sais this, the Claimant highlighted that its club “[could] not be held responsible for the incorrect payment by [the Respondent], so it granted the Respondent a 10 days’ deadline to remedy the default.

16. On 20 March 2020, after having “[provided] its fullest cooperation to [the Respondent] in their investigation”, the Claimant informed the Respondent that it could “no longer await payment”

17. On 20 May 2020, the Claimant lodged a claim against the Respondent before FIFA, requesting the amount of EUR 225.000, plus 12% interest p.a. as from the respective due dates, i.e. being 15 July 2019 and 1 February 2020, until the date of effective payment.

18. In addition, the Claimant further requested to be reimbursed CHF 5,000 from the Respondent.

19. Lastly, the Claimant requested the imposition of sporting sanctions against the Respondent.

20. In reply to the claim of the Claimant, the Respondent held that it paid the development fee in accordance with the Claimant’s payment instruction and that consequently, it complied with its contractual obligation towards the Claimant.

21. According to the Respondent, this is the chronology of the facts of the case:

• 5 August 2019: the Claimant, via Mr Kenny Victoor “finance manager of” the Claimant sent an invoice to the Respondent

• 7 August 2019: Mr Victoor sent a reminder to the Respondent with the bank details : IBAN FI9541080011367169

• 2 September 2019: the Respondent requested that the invoice should contain a PO number

• 5 September 2019: the Claimant provided a second invoice with the PO number, and allegedly, the Respondent believing that the bank account was the same as the one in the first invoice, paid the 1st instalment to the account IBAN FI9541080011367169.

• 6 September 2019: the Respondent provided a payment confirmation to the Claimant;

• 9 September 2019: Mr Victoor informed the Respondent that the bank account used for the payment was from an old account “which has been closed already, the invoice I sent you has the new transfer details”.

• On 10 September 2019: the Respondent informed the Claimant that it would follow up with the payment, thinking that the 1st instalment would be sent back to its account (bounced back from the closed account) •

On 11 September 2019: the Respondent paid the 2nd instalment to the bank account from the second invoice (ending number 8691), and believed hat the second payment would be an advance payment while it could wait for the reimbursement of the 1st instalment.

• 12 September 2019: the Claimant informed the Respondent that its Finnish account could not receive payments and that the Respondent should send the money to another account and provided an account under the name Solar Capital Ltd.

• 16 September 2019: the Respondent’s bank informed it that the account on which the 1st instalment payment had been done would not be returned as “the funds had been confiscated by the local police”.

• 2 October 2019: Mr Victoor sent an email to the Respondent stating “Please do not make any payments regarding this matter to other bank accounts. My mail account has been hacked by criminals and this is now a case we will start up with the police”

• 17 October 2019: the Respondent contacted the General Secretary of the Claimant and requested a confirmation that both payments had been paid according to the invoices and instructions provided by Mr Victoor and reiterated its request on 22 October 2019 to no avail

• 5 December 2019: the Claimant put the Respondent in default of the payment of the 1st instalment

• 18 December 2019: the Respondent contacted Mr Victoor to confirm that both payments had been made to the bank accounts provided by him and that no further payment would be done pending any reimbursement been made to the Respondent

• 2 January 2020: the Claimant argued that no payment had been received by the Claimant, that the Respondent had been victim of fraud and that the Respondent did make 2 payments, but that it should still pay the 1st instalment to the Claimant via another bank account (end number 4353).

• 22 January 2020: the Respondent reaffirmed that both payments had been made following instructions of the Claimant, and requested information on the actions (judicial) taken by the Claimant regarding the alleged hacking of its email.

• 4 February 2020: the Claimant put the Respondent in default.

• 26 February 2020: the Respondent contacted the Claimant with numerous questions to start its own investigation of the matter. The Respondent deemed that the answers provided by the Claimant tended to demonstrate that the Claimant had not conducted any investigation.

22. According to the Respondent, all the correspondence from Mr Victoor and the invoices came from his email address: kenny.victoor@kvo.be and that the Claimant does not contest this is the right email address of Mr Victoor. The Respondent held that Mr Victoor was already someone known by the Respondent and was not surprised to receive an invoice from him.

23. The Respondent held that it is not uncommon for clubs to hold bank accounts in foreign countries, which is why it was not surprised when it received an invoice for Finnish accounts.

24. The Respondent pointed out that the Claimant provided no evidence on the alleged hacking of its email and did not clearly explained which communications were legitimately sent and which were not.

25. The Respondent requested the following: “in any event, given that investigations are on-going and criminal proceedings may follow, it is respectfully submitted that this claim should be stayed pending the outcome of such investigations / proceedings”.

II. CONSIDERATIONS OF THE PLAYERS' STATUS COMMITTEE

1. First of all, the Bureau of the Players' Status Committee (hereinafter also referred to the Players’ Status Committee, the PSC, or the Bureau) analysed whether it was competent to deal with the case at hand. Taking into account the wording of art. 21 of the June 2020 edition of the Rules Governing the Procedures of the Players’ Status Committee and the Dispute Resolution Chamber (hereinafter: the Procedural Rules), the aforementioned edition of the Procedural Rules is applicable to the matter at hand.

2. Subsequently, the Players' Status Committee referred to art. 3 par. 1 of the Procedural Rules and emphasised that, in accordance with art. 24 par. 1 in combination with art. 22 lit. f) of the Regulations on the Status and Transfer of Players, the Players' Status Committee is competent to deal with matters which concern contractual disputes with an international dimension between club belonging to different associations

3. In continuation, the Players' Status Committee analysed which edition of the Regulations of the Status and Transfer of Players should be applicable to the present matter. In this respect, the Players' Status Committee confirmed that in accordance with art. 26 par. 1 and 2 of the Regulations on the Status and Transfer of Players, and considering the date when the claim was lodged, the January 2020 edition of the aforementioned regulations (hereinafter: the Regulations) is applicable to the matter at hand.

4. With the above having been established, the Players' Status Committee entered into the substance of the matter. In doing so, it started to acknowledge the facts of the case as well as the documents contained in the file. However, the Players' Status Committee emphasized that in the following considerations it will refer only to facts, arguments and documentary evidence which it considered pertinent for the assessment of the matter at hand.

5. In this respect, the Bureau noted that, on 4 July 2019, the Claimant and the Respondent signed a transfer agreement for the temporary transfer of the player Ante Palaversa, for the amount of USD 250,000 payable in two equal instalments, as follows:

- EUR 112,500, payable on 15 July 2019;

- EUR 112,500, payable on 1 February 2020.

6. Subsequently, the Bureau observed that the Claimant lodged a claim against the Respondent before FIFA, requesting the amount of EUR 225,000, plus 12% interest p.a. as from the respective due dates, i.e. being 15 July 2019 and 1 February 2020.

7. On the other hand, the Bureau took note of the Respondent’s position, according to which it paid the claimed amounts in accordance with the Claimant’s payment instructions.

8. In view of the above, the Bureau understood that the main issue at stake is to determine whether the Respondent complied with its financial obligations arising from the temporary transfer agreement.

9. Notwithstanding the above, the Bureau further wished to outline that its scope of competence only relates to the contractual dispute existing between the parties and, as such, any decision taken in this regard is without prejudice and does not preclude the possibility of an investigation being opened by the FIFA Regulatory Enforcement department against the parties involved in case of potential breach of the FIFA Regulations. Furthermore, the decision of the Bureau it is without prejudice to any future decision or action taken by FIFA or the competent decision-making bodies.

10. Subsequently, the Bureau referred to art. 12 of the Procedural Rules, which establish that “3. Any party claiming a right on the basis of an alleged fact shall carry the burden of proof. During the proceedings, the parties shall submit all relevant facts and evidence of which they are aware at that time, or of which they should have been aware if they had exercised due care” and “7. Evidence shall be considered with free discretion, taking into account the conduct of the parties during the proceedings”.

11. That being said, the Bureau noted that the first legal issue is that two instalments were provided for in the loan agreement, but no account was specified directly in the agreement. As a result, the Bureau considered that the applicable contract was not clear about where the relevant amounts should be paid.

12. In view of the above, the Bureau considered pertinent to recall the main events that occurred concerning the execution of the agreed payments.

13. In particular, the Bureau noted that, following a series of email exchanges with the person who appeared to be the Claimant’s finance manager, the Respondent made the payment of the first instalment to the bank account indicated by this person. Nevertheless, the Chamber noted that Respondent was then contacted by the Claimant and informed that the payment was made to the wrong account and that, consequently, the payment should be made again to another bank account.

14. The Bureau further noted that the Respondent made the second payment to the second bank account as instructed, but was also told by its bank that the first payment had been blocked by the local police.

15. The Bureau then observed that, thereafter, the Claimant informed the Respondent that its email address had been hacked.

16. Within this context, the Bureau also noted that that the invoices provided by the Claimant are different from the one provided by the Respondent, and none of the parties contested their authenticity.

17. Under these circumstances, the Bureau highlighted, however, that it remains undisputed that the Respondent made two payments to the Claimant, referring to the two instalments due.

18. Moreover, the Bureau also observed that the Respondent made the payment to the bank accounts as indicated by the Claimant’s financial manager, with whom the Respondent had apparently been in contact before.

19. In relation to said email, the Bureau further observed that, although the Claimant argued that its email address had been hacked, it provided no evidence in that regard, and thus, failed to meet its burden of proof in accordance with art. 12 par. 3 of the Procedural Rules.

20. With all of this in mind, the Bureau concluded that the Respondent duly paid the due agreed amounts in good faith to the bank account provided by a person who legitimately seemed to act for the Claimant.

21. As a result, considering that the Respondent provided evidence that it had made the payments following the instructions of someone who appeared to be in good faith a legitimate agent acting for the Claimant, the Bureau decided that the claim of the Claimant had to be rejected in full.

22. For the sake of completeness, the Bureau considered it appropriate to remark that, as a general rule, FIFA's deciding bodies are not competent to decide upon matters of criminal law, such as the ones of the alleged hacking of an email address, and that such affairs fall into the jurisdiction of the competent national criminal authority.

23. In continuation, and as to the payable costs, the Bureau of the PSC 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 are levied. The costs are to be borne in consideration of the parties’ degree of success in the proceedings.

24. In this respect, the Single Judge of the PSC referred to the Covid-19 Football Regulatory Issues – FAQ, published on 11 June 2020 which establish that, given the current circumstances, for any claim lodged prior to 10 June 2020 which has yet to be decided, the maximum amount of the procedural costs shall be equivalent to any advance of costs paid. Thus, considering that the amount of CHF 5,000 was paid at the beginning of the proceedings, the decided to imposed the payment of CHF 5,000 by the Claimant.

III. DECISION OF THE PLAYERS' STATUS COMMITTEE

1. The claim of the Claimant, KV Oostende, is rejected.

2. The final costs of the proceedings in the amount of CHF 5,000 are to be paid by the Claimant to FIFA (cf. note relating to the payment of the procedural costs below). Given that the Claimant already paid an amount of CHF 5,000 as advance of costs, no further payment has to be made.

For the Players' Status Committee:

Emilio García Silvero

Chief Legal & Compliance Officer

NOTE RELATED TO THE APPEAL PROCEDURE:

According to article 58 par. 1 of the FIFA Statutes, this decision may be appealed against before the Court of Arbitration for Sport (CAS) within 21 days of receipt of the notification of this decision.

NOTE RELATED TO THE PUBLICATION:

FIFA may publish this decision. For reasons of confidentiality, FIFA may decide, at the request of a party within five days of the notification of the motivated decision, to publish an anonymised or a redacted version (cf. article 20 of the Procedural Rules).

CONTACT INFORMATION:

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