F.I.F.A. – Dispute Resolution Chamber / Camera di Risoluzione delle Controversie – solidarity contribution/ contributo di solidarietà – (2016-2017) – fifa.com – atto non ufficiale – Decision 24 November 2016

Decision of the

Dispute Resolution Chamber

passed in Zurich, Switzerland, on 24 November 2016,

in the following composition:

Geoff Thompson (England), Chairman

Philippe Diallo (France), member

Takuya Yamazaki (Japan), member

on the claim presented by the club,

Club A, Country B

as Claimant

against the club,

Club C, Country D

as Respondent

regarding training compensation in connection with

the player, Player E

I. Facts of the case

1. According to the player passport issued by the Football Federation of Country B (Football Federation F), the player, Player E, born on 30 September 1995, was registered with Club A (hereafter: the Claimant or Club A) as from 9 May 2008 until 1 October 2011 as an amateur and from 2 October 2011 until 30 June 2014 as a professional. Furthermore, the aforementioned player passport indicated “no record found” for the period between 1 July 2014 and 27 July 2014.

2. The football season in Country B runs from January until December.

3. According to the information contained in the Transfer Matching System (TMS), the player was registered with the Club of Country D, Club C (hereinafter: the Respondent or Club C), on 29 July 2014, which engaged the player “out of contract free of payment”, directly from Club A.

4. Furthermore, from the information contained in TMS, it can be noted that Club C belonged to category II of UEFA (indicative amount of EUR 60,000 per season) at the moment the player was registered with Club C.

5. On 30 June 2016, Club A lodged a claim in front of FIFA against Club C, claiming the payment of training compensation for the subsequent international transfer of the player as a professional in the amount of EUR 243,095.89, plus 5% interest p.a. as of 1 July 2014, i.e. the starting date of the contract between Club C and the player. Further, Club A requested to ‘apply to the club [i.e. Club C] the disciplinary sanction of Demotion of Division, Transfer Ban and/or Fine, as well as any other applicable sanction’.

6. In its claim, Club A explains that although the player passport of the Football Federation F indicates that the player was registered on 9 May 2008 with Club A, the player’s ‘formation in the club started on 1 September 2007’ and ended on 30 June 2014. In this respect, the club refers to a document named ‘Player’s Formation Agreement’, which was concluded between the player and Club A on 1 September 2007. In addition, Club A states that the player signed a professional contract with Club A on 1 October 2011 (hereinafter: the professional contract).

7. Furthermore, Club A holds that it agreed with the termination of the professional contract as per 30 June 2014 and to release the player ‘to sign with a new club’, without charging a compensation. This because ‘the Player has no market value at the moment of his release and, therefore, could not be considered as a professional player or someone, who had already been completely formed’. Furthermore, Club A held that the player was never ‘definitely integrated to the Main Team group’, that the player played a part of 3 matches for Club A’ main team in 2013 and a part of 2 matches in 2014, as well as that ‘the labour agreement is used by South-American clubs as a protection against the inducement from other clubs’.

8. In addition, Club A held that it discussed with Club C about an amicable settlement of the matter at hand, but that the parties could not reach such solution, because Club C was of the opinion that the player’s training period finished on 1 October 2011.

9. In its reply, Club C held that is was willing to pay the amount of EUR 71,342.47 as training compensation to Club A, because it is of the opinion that the player ended his training at the age of 16, when he signed the professional contract with Club A. According to said contract, the player was entitled to a monthly salary of 20,000. Club C further holds that said contract also mentioned that – in case the player would be transferred at an international level, there would be ‘a rescission clause of EUR 30,000,000’.

10. Furthermore, Club C stated that the player played 19 matches for the first team of Club A in 2012, 6 matches in 2013 and 4 matches in 2014. In addition, Club C states that the Club of Country G, Club H - upon the transfer of the player Player J from Club A to Club H (on or around 1 August 2013) – signed an additional agreement with Club A, according to which Club H paid EUR 8,000,000 ‘for a right of first refusal regarding the acquisition of three players of Club A, including the player, Player E’.

11. In its replica, Club A argued that the professional contract with the player was only signed to ‘increase his protection from early loss of his young and promising players’. Furthermore, according to Labor Law of Country B, a penalty clause needs to be determined by multiplying the value of the player’s salary by 2,000. For this reason, the club holds to have included a penalty clause of 40,000,000 in the contract of the player, in case of early termination and a subsequent national transfer in Country B. For international transfers, the club holds that Law of Country B does not establish a limitation of value for the penalty clause. In addition, Club A confirms that Club H paid Club A for ‘the right of first refusal to assign with the player’ and that this fact merely confirms that the training of the player was not yet finished. Club A holds that it was paid by Club H for the continuation of the training of the player and that Club H would like to have the possibility to sign the player, once his training was completed.

12. Moreover, Club A argues that the number of matches in which the player would have participated, as mentioned by Club C, is in none of the seasons more than ¼ of the total number of games played by Club A. As a result, Club A argues that the training of the player was not yet finished.

13. In its duplica, Club C reiterated its positon and further held that on 2 January 2012, Club A and a Company of Country B signed - with the agreement of the player – a document referred to as ‘private instrument of assignment of image use and other agreements’ (hereinafter: the image rights contract). Club C holds that based on the image rights contract, ‘Club A received an amount of 480,000’.

II. Considerations of the Dispute Resolution Chamber

1. First of all, the Dispute Resolution Chamber (hereinafter also referred to as DRC or Chamber) analysed whether it was competent to deal with the case at hand. In this respect, it took note that the present matter was submitted to FIFA on 30 June 2016. Consequently, the 2015 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 (cf. art. 21 of the 2015 edition of the Procedural Rules).

2. Subsequently, the members of the Chamber referred to art. 3 par. 1 of the Procedural Rules and confirmed that in accordance with art. 24 par. 1 and 2 in combination with art. 22 lit. d) of the Regulations on the Status and Transfer of Players (edition 2016), the Dispute Resolution Chamber is competent to deal with the matter at stake relating to training compensation between clubs belonging to different associations.

3. Furthermore, the Chamber 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, it confirmed that in accordance with art. 26 par. 1 and 2 of the Regulations on the Status and Transfer of Players (edition 2016), and considering that the player was registered with the Respondent on 29 July 2014, the 2012 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.

4. The competence of the DRC and the applicable regulations having been established, the Chamber entered into the substance of the matter. The members of the Chamber started by acknowledging the facts of the case as well as the documentation on file. However, the DRC emphasised that in the following considerations it will refer only to the facts, arguments and documentary evidence which it considered pertinent for the assessment of the matter at hand.

5. First of all, the Chamber recalled that the player was born on 30 September 1995 and was registered with Club A as from 9 May 2008 until 1 October 2011 as an amateur and as from 2 October 2011 until 30 June 2014 as a professional.

6. In continuation, the DRC took note that Club A maintained that it is entitled to receive training compensation from Club C in the amount of EUR 243,095.89, indicating that the player was transferred as a professional from Club A to Club C before the end of the season of his 23rd birthday.

7. Furthermore, the Chamber noted that Club C rebutted the claim of Club A, alleging that it is willing to pay training compensation to Club A, however only the amount of EUR 71,342.87, since the player allegedly had terminated his training period prior to his transfer from Club A to Club C.

8. On account of the aforementioned considerations, the DRC highlighted that in the present matter it is undisputed by the parties the right of Club A to receive training compensation. Nevertheless, for the sake of completeness, the Chamber wished to recall certain general principles regarding its payment.

9. Along those lines, the Chamber referred to the rules applicable to cases regarding training compensation and stated that, as established in art. 20 of the Regulations as well as in art. 1 par. 1 of Annexe 4 in combination with art. 2 of Annexe 4 of the Regulations, training compensation is payable, as a general rule, for training incurred between the ages of 12 and 21 when a player is registered for the first time as a professional before the end of the season of the player’s 23rd birthday or when a professional is transferred between clubs of two different associations before the end of the season of the player’s 23rd birthday.

10. In this context, the DRC emphasised that, based on art. 3 par. 1 sent. 3 of Annexe 4 of the Regulations, training compensation is thus also payable to the player’s former club for the time he was effectively trained by that club, in case of the subsequent transfer of a professional before the end of his 23rd birthday.

11. Following the above, the Chamber recalled that the player was registered as a professional with Club C on 29 July 2014, this is, in the season of his 19th birthday. Equally, the Chamber stressed that, according to the player passport issued by the Football Federation F, the player was registered with Club A as from 9 May 2008 until 1 October 2011 as an amateur, and as from 2 October 2011 until 30 June 2014 as a professional.

12. On account of the above considerations, the DRC concluded that in fact, as acknowledged by both parties, Club C would, in principle, be liable to pay training compensation to Club A, which is the player’s former club in the sense of art. 3 par. 1 sent. 3 of Annexe 4 of the Regulations, in accordance with art. 20 and Annexe 4 of the Regulations.

13. Notwithstanding the above, the Chamber noted that Club C is of the opinion that the player’s training period ended before the player’s registration with it. In particular, the Chamber noted that Club C holds that (a) the player played 19 matches for Club A in 2013, 6 matches in 2013 and 4 matches in 2014, (b) that Club H allegedly concluded an agreement with Club A regarding the ‘right of first refusal’ for the player, (c) that there were several penalty clauses included in the contract and (d) that Club A and a Company of Country B concluded an image rights document for the image rights of the player.

14. Having established the above, the Chamber first referred to art. 1 par. 1 sent. 2 of Annexe 4 of the Regulations which stipulates that training compensation shall be payable, as a general rule, up to the age of 23 for training incurred up to the age of 21, unless it is evident that a player has already terminated his training period before the age of 21. In this respect, the DRC emphasised that cases involving a possible early completion of a player’s training period have to be analysed on a case-by-case basis, taking into consideration all the specific circumstances of each case. Thus, several factors and indications have to be considered in order to establish whether a particular player’s training has indeed been completed before the age of 21, as Club C stated. For the sake of completeness, the members of the Chamber stressed that both the DRC and the CAS have adopted a strict approach in establishing the early completion of the player’s training before the age of 21, so as to not jeopardize the right of training clubs to, in principle, receive training compensation for the entire period during which the relevant player was registered with them. Indeed, the Chamber wished to recall that the purpose of training compensation is to give a financial reward to clubs that invest in the training of the player.

15. In this respect, the Chamber recalled the basic principle of burden of proof, as stipulated in art. 12 par. 3 of the Procedural Rules, according to which a party claiming a right on the basis of an alleged fact shall carry the respective burden of proof.

16. With the above principles in mind, the Chamber noted, once more, all the specific circumstances of the present matter as well as all the evidence produced by the parties. In this respect, it referred to its well-established jurisprudence that the number of matches played for the club’s first team does not necessarily constitute the only and decisive factor for the completion of a player’s training. As a result, the Chamber considered that solely on this circumstance, it could not be established that the player had completed his training period. What is more, as to Club C’s argument of the number of matches played by the player, the Chamber highlighted that, during the period of registration with Club A, the player was not fielded on a regular basis, with an average of no more than 10 matches per season in the League of Country B.

17. Secondly, the Chamber turned to Club C’s argument that the Club of Country G, Club H allegedly concluded an agreement with Club A, under which it paid an amount of EUR 8,000,000 for the ‘right of first refusal regarding the acquisition of three players, including the player, Player E’, as a result of which – according to Club C - it could be considered that the player had already finished his training period before reaching the age of 21.

18. In this regard, the Chamber was of the opinion that, as greed by Club A, such alleged payment made by Club H to Club A, more than entailing that the player’s training period had ended, implies that said period was still ongoing. In any case, the DRC wished to point out that such payment, is not sufficient on its own to prove that the player’s training period had ended. Even more, considering the nature thereof.

19. In continuation, with reference to Club C’s argument that the contract contained several penalty clauses in case of a national or international transfer of the player, the Chamber noted that this may be an indication of the player’s talent and skills of the player, however, that such fact is not conclusive in establishing that a particular player indeed already completed his training period. In any case, it appears from the information on file that on 29 July 2014, Club C engaged the player ‘out of contract free of payment’, directly from Club A, indicating that the player had no market value to Club A at the moment of his release. As a result, the Chamber established that in July 2014, Club A had not awarded any value to the services of the player.

20. Finally, regarding Club C’s allegation that Club A concluded an image rights document with a Company of Country B regarding the use of the player’s image rights, the Chamber outlined that the image rights agreement may be an indication of the commercial value of the player. However, it has little connection, if any, to the actual training period of the player, which shall be assessed mainly on sporting criteria. Therefore, the Chamber rejected this argument of Club C.

21. In view of the above, the Chamber concurred that, taking into account all the above-mentioned elements and circumstances, it could not be established that it was evident that the player had indeed completed his training period before his 21st birthday. Consistently with all the above, the Chamber concluded that training compensation is due.

22. Turning its attention to the calculation of training compensation, the DRC referred to the FIFA circular no. 1537 dated 3 May 2016 which provides details for the calculation of training compensation as well as to art. 5 par. 1 and par. 2 of Annexe 4 of the Regulations, which stipulate that as a general rule, to calculate the training compensation due to a player’s former club, it is necessary to take the costs that would have been incurred by the new club if it had trained the player itself.

23. In continuation, the Chamber observed that according to the documentation on file, Club C belonged to the category II and that the player was registered with Club A as from 9 May 2008 until 30 June 2014.

24. Consequently, taking into account the aforementioned considerations, the Chamber decided to accept Club A’ claim and pointed out that Club C is liable to pay training compensation to Club A in the amount of EUR 243,095.89, as requested by Club A.

25. Moreover, taking into consideration Club A’ claim as well as art. 3 par. 2 of Annexe 4 of the Regulations, the Chamber decided that, in conformity with its longstanding practice, Club C has to pay interest at 5% p.a. over the amount payable as training compensation as of the 31st day of the registration of the player with Club C, i.e. as of 29 August 2014, until the date of effective payment.

26. Lastly, the Chamber 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 DRC relating to disputes regarding training compensation costs in the maximum amount of CHF 25,000 are levied. It is further stipulated that the costs are to be borne in consideration of the parties’ degree of success in the proceedings and that, in accordance with Annex A of the Procedural Rules, the costs of the proceedings are to be levied on the basis of the amount in dispute.

27. In respect of the above, the Chamber held that the amount to be taken into consideration in the present proceedings is EUR 243,095.89 related to the claim of Club A. Consequently, the Chamber concluded that the maximum amount of costs of the proceedings corresponds to CHF 25,000 (cf. table in Annex A).

28. As a result, and taking into account the particularities of the present matter, the number of issues that had to be addressed, the complexity of the case as well as that the claim of Club A has been accepted, the Chamber determined the costs of the current proceedings to the amount of CHF 21,000, which shall be borne by Club C.

III. Decision of the Dispute Resolution Chamber

1. The claim of the Claimant, Club A, is accepted.

2. The Respondent, Club C, has to pay to the Claimant within 30 days of the date of notification of this decision, the amount of EUR 243,095.89, plus 5% interest p.a. on said amount as of 29 August 2014 until the date of effective payment.

3. In the event that the aforementioned sum plus interest is not paid within the stated time limit, the present matter shall be submitted, upon request, to FIFA’s Disciplinary Committee for consideration and a formal decision.

4. The final amount of costs of the proceedings in the amount of CHF 21,000 are to be paid by the Respondent within 30 days as from the date of notification of the present decision as follows:

4.1. The amount of CHF 16,000 has to be paid to FIFA to the following bank account with reference to case no. XXX:

UBS Zurich

Account number 366.677.01U (FIFA Players’ Status)

Clearing number 230

IBAN: CH27 0023 0230 3666 7701U

SWIFT: UBSWCHZH80A

4.2. The amount of CHF 5,000 has to be paid to the Claimant.

5. The Claimant is directed to inform the Respondent immediately and directly of the account number to which the remittances under points 2. and 4.2. are to be made and to notify the Dispute Resolution Chamber of every payment received.

*****

Note relating to the motivated decision (legal remedy):

According to art. 587 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

For the Dispute Resolution Chamber:

Training compensation in connection with the player, Player E

(Club A, Country B / Club C, Country D) 10

_______________________

Marco Villiger

Deputy Secretary General

Encl.: CAS directives