DECISIONI DI GIUSTIZIA SPORTIVA • F.I.F.A. - CAMERA DI RISOLUZIONE DELLE CONTROVERSIE - CONTROVERSIE DI LAVORO

• Data decisione: 6 dicembre 2019 • Stagione sportiva: 2019/2020

F.I.F.A. – Dispute Resolution Chamber / Camera di Risoluzione delle Controversie – labour disputes / controversie di lavoro (2019-2020) – fifa.com – atto non ufficiale – Decision 6 December 2019

Decision of the

Dispute Resolution Chamber

passed in Zurich, Switzerland, on 6 December 2019,

in the following composition:

Geoff Thompson (England), Chairman

Alexandra Gómez Bruinewoud (Uruguay), member

Stijn Boeykens (Belgium), member

Stefano La Porta (Italy), member

Abu Nayeem Shohag (Bangladesh), member

on the claim presented by the club,

CA Paranaense, Brazil

Represented by Mr. Mr. Marcos Motta & Mr. Victor Eleuterio

as Claimant

against the player,

Vinicius de Lima Ferreira, Brazil

represented by Mr. Diego Barreto

as Respondent 1

and the club,

SL Benfica, Portugal

as Respondent 2

regarding an employment-related dispute

arisen between the parties

I. Facts of the case

1. On 3 April 2012, CA Paranaense (hereinafter: the Claimant), a club affiliated to the Confederação Brazileira de Futebol (hereinafter: CBF), the Brazilian player Vinicius de Lima Ferreira (hereinafter: the player), born on 3 April 1998, and the player’s father acting on his behalf, signed a “Contrato de Formação Desportiva” (hereinafter: sports training contract).

2. Clause 1.1. of the sports training contract stipulated that “This Sports Training Agreement, which does not create an employment relationship between the parties, with minimum duration of one (1) year, shall be effective from April 3, 2012, to the date when the ATHLETE turns twenty (20) years old, under Art. 29, paragraph 4 of Law 9.615/98”.

3. According to clause 4.1 of the sports training contract, the player was entitled “as financial aid, as scholarship” to the following amounts:

(a) BRL (Brazilian Real) 400 per month, “as of the execution of this agreement”;

(b) BRL 500 per month “during the season in which the [player] completes 15 years of age”;

(d) BRL 1,000 per month “during the season in which the [player] completes 17 years of age”;

(e) BRL 1,200 per month “during the season in which the [player] completes 18 years of age”;

(f) BRL 1,600 per month “during the season in which the [player] completes 19 years of age”;

(g) BRL 1,800 per month “during the season in which the [player] completes 20 years of age”.

4. Pursuant to clause 5.1 of the sports training contract, the player “is obliged to enter into the first Special Sports Labor Agreement with [the Claimant], upon completing sixteen (16) years of age, with a term not exceeded five (5) years”.

5. Clause 10 of the sports training contract provides that “in case of any dispute, the parties undertake to submit to arbitration, using the Dispute Committee created by the respective administration entity to which he is linked”.

6. Clause 13.1 of the sports training contract established that “It is hereby set forth the minimum conditions of the first Special Sports Labor Agreement to be entered into between the [player] and [the Claimant], if the latter chooses to exercise the right provided in article 29, main provision of Law 9.615/98

a) Term: up to 5 years, at [the Claimant’s] discretion;

b) Initial salary: amount equivalent to the monthly financial scholarship fund in force at the extinction of the Sports Training Agreement (…) plus fifty per cent (50%);

c) Salary adjustment per term: at each year of the contractual term, an adjustment of twenty per cent (20%) is applied to the monthly compensation of the previous year;

d) National Sports Indemnification Clause: an amount equivalent to 2,000 times the average amount of the contractual salary of the [player], or the legal limit;

e) International Sports Indemnification Clause: EUR 30,000,000 (thirty million Euros) ;

d) Sports Compensation Clause: total amount of the monthly salary to which the player would be entitled as of the date of the agreement is terminated until the date of agreement expires”.

7. On 24 July 2015, the player filled a complaint at the Police of Curitiba, stating that the Claimant was forcing him to sign his first professional contract.

8. On 31 August 2015, the Claimant sent the player a letter requesting him to resume his duties within 48 hours considering that he was allegedly absent since 23 July 2015.

9. On 22 September 2015, the Claimant sent a second default notice to the player requesting him to resume to the trainings of the Claimant.

10. On 1 August 2016, the player signed an employment contract with SL Benfica (hereinafter: Benfica), a club affiliated to the Federaçao Portuguesa de Futebol (hereinafter: FPF), valid as from 1 August 2016 until 30 June 2021. In accordance with contract, the player was inter alia entitled to receive the following amounts:

(a) Signing on fee in the amount of USD 4,200;

(b) EUR 46,200 for the 2016/2017 season;

(d) EUR 50,400 for the 2018/2019 season;

(e) EUR 50,400 for the 2019/2020 season;

(f) EUR 50,400 for the 2020/2021 season.

11. On 24 August 2016, Benfica sent an e-mail to the Claimant by means of which it requested a TPO declaration as the players was going to be registered with Benfica.

12. On the same date, the Claimant sent a letter to Benfica by which it requested the Portuguese club to refrain from registering the player

13. On 31 August 2016, the Player’s International Certificate (ITC) was requested by the FPF.

14. On 13 October 2016, the Single Judge of the Players’ Status Committee (PSC) authorised the FPF to provisionally register the player with Benfica.

15. On 12 October 2016, the Claimant lodged a claim in front of FIFA against the player and Benfica in front of FIFA, maintaining that the former breached the contract without just cause and requested:

(a) EUR 30,000,000 plus 12% interest p.a. as from 2 August 2016 until the date of effective payment, as compensation in accordance with clause 13.1 lit. “e” of the contract.

(b) That Benfica be declared jointly and severally liable and that sanctions be imposed on it;

(d) Disciplinary sanctions against Benfica “for consideration of possible violations against article 19 of FIFA RSTP”.

16. In this respect, the Claimant maintained that, on 3 April 2012, in accordance with art. 29 of the Brazil Federal law n 9.615/98 (hereinafter: the Pelé Law), it had signed with the player a sports training contract, which in Brazil should be considered as an amateur contract.

17. However, the Claimant maintained that the said sports training contract is to be considered for the present purposes and in light of art. 2 of the Regulations on the Status and Transfer of Players (hereinafter: the Regulations) a professional contract.

18. That being said, the Claimant recalled that, as soon as the player turned 16 years old, it invited him to sign a “Contrato Especial de Trabalho Deportivo”, that is to say a special sports labour agreement which the player refused to sign. Within this context, the Claimant stated that as of 23 July 2015, the player failed to report for training sessions at the Claimant’s facilities (cf. point I.8 above).

19. In the Claimant’s opinion, although the player was not to be considered a professional under the Pelé Law (according to which a professional is a player who signs a “Contrato Especial de Trabalho Desportivo”), but it has to be considered as such under the RSTP. That clarified, the Claimant argued that the RSTP should prevail over the Pelé Law. In this respect, the Claimant pointed out that, according to the CAS jurisprudence, “in case of inconsistency between a CBF provision and a FIFA provision, the FIFA provision should prevail” (CAS 2008/A/1370 & 1376, para 105) and that the notion of professional player is “autonomous from the corresponding national regulations” (TAS 2009/A/1895).

20. With the foregoing in mind, the Claimant concluded that it had a professional contract in place with the player since they had concluded a written contract providing emoluments surpassing the expenses effectively incurred by the player. More specifically, the Claimant concluded that “although from a formal perspective the contract was in principle an amateur contract […] and the player was registered with the CBF as an amateur, in practice both requirements of [art. 2 RSTP] are undisputedly fulfilled”.

21. Alternatively, should the player not be considered a professional, the Claimant maintained that it had signed with the latter a pre-contract (i.e. the sports training contract) containing all the essentialia negotii. In this context, the Claimant argued that the player refused to sign the “Contrato Especial de Trabalho Desportivo” (i.e. special sports labor agreement) without any valid reason.

22. In view of all the above, the Claimant held that the player breached the sports training contract without just cause on 1 August 2016, date on which the player signed a contract with Benfica. Therefore, the Claimant maintained that it was entitled to EUR 30,000,000 established in clause 13.1 of the sports training contract as “penalty clause for international transfers”, plus 12% interest p.a. pursuant to Brazilian law.

23. In his answer to the claim, the player argued that the Claimant’s claim should be considered inadmissible in light of clause 10 of the sport training contract (cf. point I.5 above). According to the player “the CBF NDRC is the only place with jurisdiction to decide any matter” in relation to the sorts training contract, and the player presented a copy of the regulations of the CBF National Dispute Resolution Chamber (hereinafter: CBF NDRC) in support of his allegations.

24. As to the substance, the player stated that he was unmistakably under an amateur contract with the Claimant and that it was never the intention of the parties to enter into an employment relationship when they signed the sports training contract.

25. Moreover, the player pointed out that he was only 14 years old when he signed the sports training contract and thus, “to young to enter (validly) into an employment relationship to any football club whatsoever” in accordance with article 29 of the Pelé Law.

26. Subsequently, the player explained that the Claimant tried on several occasions to force him to sign his first professional contract. According to the player, he refused to do so considering that the conditions established in clause 13 of the sports training contract were abusive. Within this context, the player explained that he had no other alternative except to return to his home city and subsequently, lodge a claim against the Claimant before the Brazilian ordinary courts in order to unilaterally terminate the sports training contract with just cause.

27. Furthermore, the player highlighted that the sports training contract contained a unilateral clause by means of which, at the sole discretion of the Claimant, the player was contractually bound to it for five additional years. In this respect, the player pointed out that, in light of the fact that the said contract was meant to run as from 3 April 2012 until the player’s age of 20 (i.e. 3 April 2018) the player at the age of 14 entered in to a six-year contract with the Claimant, thus violating art. 18 para 2 of the FIFA RSTP. Such clause, in the player’s opinion, should be considered null and void since unilateral and potestative in nature.

28. The player highlighted that, however, should their previous arguments be dismissed, the “liquidated damages set” contained in the sports training contract (i.e. clause 13 lit. e) of the sports training contract) should be disregarded and the request of EUR 30,000,000 considered completely disproportionate.

29. Finally, and in the unlikely event that he must pay compensation to the Claimant, the player argued that the amount of compensation due to the Claimant “shall not be in any event higher” than the residual value of the sports training contract, i.e. BRL 9,600 (BRL 1,200 x 8, salaries from August 2016 until April 2017). Or in the alternative, that the total amount of compensation due by the player “would be never higher than EUR 30,928”, i.e. EUR 33,600 for the salaries from August 2016 until April 2017 with Benfica (EUR 4,200 x 8) minus the remaining value of the sports training contract with the Claimant which according to the player is EUR 2,672.

30. In its replica, with regards to the argument of competence raised by the Respondent, the Claimant explained that FIFA DRC is competent to deal with the present matter in accordance with art. 22 lit. a) and art. 24 of FIFA RSTP.

31. In continuation, the Claimant “denies de allegation that the player have suffered, at any point in time, coercion to enter into any contracts with [the Claimant]”.

32. Moreover, the Claimant argued that signing a contract at the age of fourteen is “perfectly legal and valid under both Brazilian and FIFA RSTP”. In this regard, the Claimant stated that “there is no prohibition or whatsoever that a minor player would enter into a pre-contract agreeing to formally sign a special sports work contract after the age of sixteen, specially (sic) when signing it together with his father and duly advised by a lawyer”.

33. Concerning the argument related to the duration of the contract, the Claimant recognised that the sports training contract had a validity longer than 3 years, but maintained that it was “based on article 29, par. 4, of the Pelé Law, which allows Contratos de Formação Desportiva to be concluded for the period running from the players fourteenth to the twentieth-first birthday”. In this respect, the Claimant added that, according to the RSTP Commentary of art. 18.2, “after the end of the third year, the player is free to leave the club unless he explicitly or de facto accepts the extension”.

34. On the player’s argument concerning the unilateral extension of the contract, the Claimant pointed out the CAS had already established that unilateral extension options “are not per se invalid under the FIFA RSTP”. According to the Claimant, the contractual scenario at hand respected all the criteria that the jurisprudence devised in order for these kind of clauses to be valid, amongst others especially the increased remuneration.

35. Regarding the amount of compensation claimed, the Claimant recalled that, according to art. 163 of the Swiss Code of Obligations, the parties are free to determine the amount of the contractual penalty. Moreover, the Claimant maintained that, for a judge to intervene and reduce the amount of a penalty there must be a substantial imbalance in the penalty clause.

36. That said, the Claimant thought worth it to bear in mind the following: (i) “the universal principle of pacta sunt servanda” (ii) the Claimant gave the player, inter alia, the opportunity to “develop his career to the highest level” and that (iii) the Claimant is one of the most important and well-organized clubs in Brazil and South America, and therefore, has the “interest of protecting all the talent revealed on its grassroots”. For all the foregoing, the Claimant maintained that the penalty clause was “unquestionably proportionate” and, thus, enforceable.

37. Finally, and concerning the breach of art. 18 par. 3 of the RSTP, the Claimant maintained that Benfica had initiated talks with the player without “informing the Claimant”. In this respect, the Claimant remarked that Benfica “was fully aware of the ongoing dispute between [the Claimant] and the player before the labour court of Curitiba”.

38. In its duplica, the player reiterated his argumentation sustained within his answer to the claim.

39. On its part, Benfica rejected Paranense’s claim. More specifically, Benfica argued that the contract signed with Benfica is the player’s first professional contract. According to Benfica, “it would never have concluded an employment contract with the player if it had known that the player was not an amateur or it was under a valid contract, which is not the case”.

40. Benfica first argued that according to the player’s passport issued by the CBF the player was always registered as an amateur with the Claimant.

41. Then, Benfica highlighted that the title and the clauses of the sports training contract clearly established that said document was not an employment contract (i.e. clause one established “this sports training agreement does not create an employment relationship between the parties”).

42. What is more, Benfica pointed out that the player only played amateur matched for Claimant’s U17 team, and could therefore not be considered as an established professional player.

43. In this respect, Benfica was of the opinion that the financial conditions set out in the sports training agreement did not foresee a monthly remuneration but rather “just a mere insignificant financial aid”.

44. In addition, Benfica underlined that the duration of the sports training agreement exceed the maximum length of a contract required for professionals and clubs (cf. art. 18 par. 2 of the Regulations), and that, when he signed the sports training contract, the player was only 14 years old and consequently, too young to validly enter into an employment relationship.

45. Finally, Benfica pointed out that the penalty clause included in the sports training contract creates a “clear restriction of the player personal freedom and apart from this creates a situation of excessive imbalance between the parties” as it is “notoriously disproportionate”.

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, the Chamber took note that the present matter was submitted to FIFA on 12 October 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 Procedural Rules).

2. Subsequently, the Chamber referred to art. 3 par. 1 of the Procedural Rules and confirmed that in accordance with art. 24 par. 1 in combination with art. 22 lit. a) of the Regulations on the Status and Transfer of Players (edition October 2019), the Dispute Resolution Chamber would, in principle, be competent to deal with the matter at stake, which concerns a dispute between a Brazilian player and a Brazilian club in relation to the maintenance of contractual stability where there has been an ITC request.

3. However, the DRC acknowledged that the player contested the competence of FIFA’s deciding bodies on the basis of clause 10 of the sports training contract, alleging that the competent body to deal with any dispute deriving from the relevant employment contract is the CBF NDRC.

4. On the other hand, the Chamber noted that the Claimant insisted on the competence of the FIFA DRC to adjudicate on the claim lodged by him against the player and Benfica.

5. Taking into account all the above, the Chamber emphasised that it is competent to deal with a matter such as the one at hand, unless the parties explicitly opt in writing for such disputes to be decided by an independent arbitration tribunal, guaranteeing fair proceedings and respecting the principle of equal representation of players and clubs, has been established at national level within the framework of the association and/or a collective bargaining agreement.

6. In this respect, the DRC turned its attention to the wording of clause 10 of the sports training contract, and duly acknowledged that it stipulated that “in case of any dispute, the parties undertake to submit to arbitration, using the Dispute Committee created by the respective administration entity to which he is linked”.

7. The Chamber was pointed out that the clause was rather vague and open to interpretation, remarked that, contrary to the argumentation of the player, and remarked that the clause was not specifically referring to the CBF NDRC.

8. Therefore, in the absence of clear and unambiguous reference to the CBF NDRC, the Chamber established that the player’s objection towards the competence of FIFA to deal with the present matter has to be rejected, and that the Dispute Resolution Chamber is competent to consider the present matter as to the substance.

9. In continuation, 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, the Chamber referred, on one hand, to art. 26 par. 1 and 2 of the Regulations on the Status and Transfer of Players (edition October 2019) and, on the other hand, to the fact that the present claim was lodged on 12 October 2016. Therefore, the DRC concluded that the 2016 edition of the Regulations is applicable to the matter at hand as to the substance.

10. The competence of the Chamber and the applicable regulations having been established, and entering into the substance of the matter, the DRC continued by acknowledging the above-mentioned facts as well as the documentation contained in the file. However, the Chamber 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.

11. First of all, the DRC acknowledged that the Claimant and the player entered into a sports training contract on 3 April 2012, when the player was 14 years old, and that, according to clause 1.1 of said agreement, the contractual relationship would be valid until the player turns 20 years old, i.e. 3 April 2018.

12. The member of the Chamber also duly noted that pursuant to that agreement the player “is obliged to enter into the first Special Sports Labor Agreement with [the Claimant], upon completing sixteen (16) years of age, with a term not exceeded five (5) years”.

13. Subsequently, the Chamber observed that clause 13.1 lit. “e” of the sports training contract established an “International Sports Indemnification Clause” in the amount of EUR 30,000,000.

14. The DRC further observed that the Claimant lodged a claim in front of FIFA against the player and Benfica seeking payment of the amount of EUR 30,000,000 plus 12% interest p.a. as from 2 August 2016 until the date of effective payment, as compensation in accordance with clause 13.1 lit. “e” of the contract, along with sanctions to be imposed on them, as well as additional disciplinary sanctions on Benfica for allegedly breaching art. 19 of the Regulations.

15. In this respect, the Chamber observed that the Claimant argued that, although the player was not to be considered a professional under the Pelé Law, he has to be considered as such under the Regulations. That clarified, the Claimant argued that the Regulations should prevail over the Pelé Law.

16. In addition, the Chamber acknowledged that the Claimant stated that the player was bound by a valid contract which contained an “International Sports Indemnification Clause [of] EUR 30,000,000 (thirty million Euros)” and that Benfica induced him to breach his contract without just cause by entering into a new contract with the player on 1 August 2016.

17. Furthermore, the DRC observed that the player, for its part, stated that the sports training contract is by all means an amateur contract and that, however, according to the Regulations players under 18 years old cannot sign professional contracts for a period longer than 3 years (cf. art. 18 para 2 of the Regulations). What is more, the player was of the opinion that, in any case, the “International Sports Indemnification Clause” should be considered disproportionate and be dismissed or alternatively largely reduced.

18. Subsequently the DRC duly acknowledged that Benfica sustained that the player was undoubtedly an amateur when he signed a contract with it on 1 August 2016. Nevertheless, Benfica declared that the player was too young to sign a professional contract when signing the sports training contract with the Claimant, and that besides said agreement was of a duration exceeding the maximum duration permitted by art. 18 par. 2 of the Regulations.

19. Having said that, the Chamber concluded that the key arguments raised by the parties in the present matter are related to the validity of the sports training agreement, which is indeed contested by the player and Benfica.

20. In this respect, the DRC wished to point out that when deciding a dispute before the DRC, FIFA’s regulations prevail over any national law chosen by the parties. Moreover, the Chamber emphasized that the main objective of the FIFA regulations is to create a standard set of rules to which all the actors within the football community are subject to and can rely on. This objective would not be achievable if the DRC would have to apply the national law of a specific party on every dispute brought to it. This should apply, in particular, also to the termination of a contract. In this respect, the DRC wished to point out that it is in the interest of football that the termination of contract is based on uniform criteria rather than on provisions of national law that may vary considerable from country to country. Therefore, the Chamber deems that it is not appropriate to apply the principles of a particular national law to the termination of the contract but rather the RSTP, general principles of law and, where existing, the Chamber’s well-established jurisprudence.

21. Subsequently, the Chamber referred to art. 2 par. 2 of the Regulations, which stipulates that “A professional is a player who has a written contract with a club and is paid more for his footballing activity than the expenses he effectively incurs. All other players are considered to be amateurs”.

22. Taking into consideration the criteria set out in art. 2 par. 2 of the Regulations as well as the amounts payable to the player on the basis of sports training contract, the members of the Chamber concluded that it was beyond a doubt that the player was in fact paid more for his footballing activity than the expenses he effectively incurred. In this regard, the Chamber was eager to emphasize that a player’s remuneration as per the criteria set out in art. 2 par. 2 of the Regulations constitutes the decisive factor in the determination of the status of the player and that the legal nature or the designation of the contract is of no relevance in this regard.

23. Equally, the Chamber highlighted that the second element contained in said art. 2 par. 2 of the Regulations, i.e. the existence of a written contract, is met. On account of all the above, the Chamber concurred that the sports training contract fulfill the requirements that art. par. 2 of the Regulations established in order to be considered as a professional contract.

24. This being established, the members of the Chamber paid particular attention to clause 1.1 of the sports training contract, and duly noted that the agreement has a length of 6 years with an unilateral extension option of 5 years and that it was signed when the player only 14 years old.

25. The Chamber recalled the provisions set out in art. 18 par. 2 of the Regulations, according to which players under the age of 18 may not sign a professional contract for a term longer than three years and that any clause referring to a longer period shall not be recognised.

26. As such, the DRC emphasised that the Claimant and the player entered into an agreement for a duration clearly exceeding the maximum duration permitted in the provisions set out in art. 18 par. 2 of the Regulations, and that these provisions unequivocally stipulates that such clause “shall not be recognised”.

27. Consequently, the DRC had no other option but to conclude that the length of the sports training contract was not in line with the Regulations and cannot be recognised. Consequently, it can be concluded that, after 3 years, i.e. on 3 April 2015, the player was not any longer under a valid contract with the Claimant and could validly sign a contract with a new club, including Benfica.

28. As a result, and in view of all the above, the Chamber rejected the claim of the Claimant.

*****

III. Decision of the Dispute Resolution Chamber

1. The claim of the Claimant, CA Paranaense, is admissible.

2. The claim of the Claimant is rejected.

*****

Note related to the publication:

The FIFA administration may publish decisions issued by the Players’ Status Committee or the DRC. Where such decisions contain confidential information, 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 Rules Governing the Procedures of the Players’ Status Committee and the Dispute Resolution Chamber).

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). 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. 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

e-mail: info@tas-cas.org

www.tas-cas.org

For the Dispute Resolution Chamber:

Emilio García Silvero

Chief Legal & Compliance Officer