F.I.F.A. – Dispute Resolution Chamber / Camera di Risoluzione delle Controversie – labour disputes / controversie di lavoro (2020-2021) – fifa.com – atto non ufficiale – Decision 13 November 2020

Decision of the

Dispute Resolution Chamber

passed on 13 November 2020,

regarding an employment-related dispute concerning the player Rafael Lopez Gomez

COMPOSITION:

Omar Ongaro (Italy), Deputy Chairman Daan de Jong (Netherlands), member Stijn Boeykens (Belgium), member

CLAIMANT:

RAFAEL LOPEZ GOMEZ, Spain

Represented by Mr. Juan de Dios Crespo Perez and Mr Alfonso Leon

Lleo

RESPONDENT:

HYDERABAD FC, India

I. FACTS

1. On 15 August 2019, the Spanish player Rafael Lopez Gomez (hereinafter: the player or Claimant) and the Indian club Hyderabad FC (hereinafter: the club or Respondent) signed a contract, valid as from 15 August 2019 until 30 June 2020, as well as an addendum to said agreement, hereinafter to be referred to as “Schedule 1”.

2. Schedule 1 stipulates the following: “The Club shall pay to the Player a total fee (net of Withholding Tax) of USD 135,000/- [US Dollars One Hundred and Thirty-Five Thousand] (the “Fee”) for the 2019-20 season which shall be paid in equal monthly instalments starting from October 2019 to May 2020 on the 5th day of the month”.

3. On 8 May 2020, the club confirmed that it failed to comply with its contractual obligations and indicated that it would settle the debt of USD 67,500 within 10 working days after the lockdown gets over in Telangana on 29 May 2020.

4. On 24 June 2020, the club put the player in default, and granted a final deadline to the club to settle the debt of USD 67,500.

5. On 2 December 2020, the player lodged a claim against the club, claiming the total amount of USD 67,500 as outstanding remuneration, plus 5% interest p.a. as follows:

(i) 5% p.a. on the amount of EUR 16,875 as from 5 February 2020;

(ii) 5% p.a. on the amount of EUR 16,875 as from 5 March 2020;

(iii) 5% p.a. on the amount of EUR 16,875 as from 5 April 2020;

(iv) 5% p.a. on the amount of EUR 16,875 as from 5 May 2020.

6. Furthermore, the player requested: “To condemn the Respondent to provide the Player with the relevant tax certificates attesting the payment of taxes to the competent tax authorities in relation to the salaries paid (payable) in accordance with the Agreement”.

7. In his claim, the player explains that the club failed to pay him 4 monthly salaries of USD 16,875 each, corresponding to the salaries for the period between February 2020 and May 2020.

8. In its reply, the club explained that as from January 2020, it started to face problems with sponsor money not coming into the club, which circumstance got aggravated due to the outbreak of the COVID-19 pandemic. The club confirmed that said situation “lingered on till the month of July 2020”.

9. The club further explains that on 7 May 2020, it received a message from the AIFF Player Status Department (AIFF PSD), which informed the club that the player had informed the AIFF PSD that the amount of USD 67,500 was outstanding. On 8 May 2020, the club confirmed said circumstance to the player.

10. After several correspondences back and forth between the player and the club, in which the player requested for the payment of USD 67,500 the latest until 17 June 2020 as well as a “Tax Certificate to be submitted by the Player to the Government Authorities in Spain for taxation purposes.”, the outstanding amount remained unpaid.

11. According to the club, the Appeals Committee of the All Indian Football Federation - on 10 July 2020 - gave permission to make the payments due to several players of its club, including the player, until 31 July 2020.

12. Consequently, the club submitted evidence that on 7 August 2020, it paid an amount of USD 67,500 to the player, as a result of which it assumes that the matter can be closed.

13. In reply to the allegations of the club, the player explained the following: “The Respondent in full recognition of the breach it had committed of the relevant employment contract did make a partial payment over its debt towards the Claimant but not in full. However, USD 8,304.00/- (eight thousand three hundred four US dollars) are still due; as the Club did not pay in full the overall debt, neither the full relevant conversion levy, neither the full interests over the full amount since the 5th of February 2020, neither the relevant tax certificates have been provided to the Player enabling the latter to afterwards prove before the relevant tax authorities that said income has already been duly taxed and therefore not seeing it withdrawn from him on up to 45% in Spain.”

14. As a result, the player amended his claim and asks for the following amounts to be paid:

• the overdue payment in the amount of USD 8,304/- (eight thousand three hundred four US dollars) “net of Withholding Tax” and corresponding interest of five percent (5%) per annum applicable to the amount due until the date of effective payment as follows: (i) 5% p.a. on the amount of EUR 8,304 as from 7th of August 2020;

• to condemn the club to provide the player with the relevant tax certificates attesting the payment of taxes to the competent tax authorities in relation to the salaries paid (payable) in accordance with the Agreement.

15. In reply to the amended claim of the player, the club argued that it duly paid the 4 outstanding salaries of USD 16,875 each, i.e. the total amount of USD 67,500, for the period between February and May 2020 duly to the player on 12 August 2020, as this amount was claimed several times by the club in default letters.

16. Moreover, the club argues that the player was entitled to USD 135,000 “net of withholding tax” and that there was no further obligation from it to pay interest or currency value fluctuation.

17. In addition, the club points out that it requested the player, on 24 August 2020, to sign a “No Dues Certificate”, however that the player refused to sign this document and instead claimed an additional amount of USD 8,034 before FIFA’s DRC. Said amount, according to the club, must be linked to “exchange rate”, as the club paid the bank charges “over and above the net amount so that the individual receives his full payment as per the Player Contract”.

18. Finally, from an attachment submitted by the club, it becomes clear that the player deems that the amount of USD 8,304 should be broken down as follows:

- USD 3,375 as 5% interest p.a. as from 5 February 2020 as requested in the original claim of the player;

- USD 4,168.54 as “exchange rate loss between USD and EUR”, since the amount were only paid on 7 August instead of 5 February, 5 March, 5 April and 5 May 2020.

II. CONSIDERATIONS OF THE DISPUTE RESOLUTION CHAMBER

1. First of all, the Dispute Resolution Chamber (hereinafter also referred to as Chamber or DRC) 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 7 June 2020. Taking into account the wording of art. 21 of the 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 members of 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. b) of the Regulations on the Status and Transfer of Players (edition October 2020), the Dispute Resolution Chamber is competent to deal with the matter at stake. The matter concerns an employment-related dispute with an international dimension between a Spanish player and an Indian club, and the competence is not disputed by the parties.

3. In continuation, the Chamber analysed which regulations should be applicable as to the substance of the matter. In this respect, the DRC confirmed that in accordance with art. 26 par. 1 and 2 of the Regulations on the Status and Transfer of Players (October 2020 edition), and considering that the claim was lodged on 7 June 2020, the June 2020 edition of the aforementioned regulations (hereinafter: the Regulations) is applicable to the matter at hand as to the substance.

4. The competence of the Chamber and the applicable regulations having been established, the Chamber entered into the substance of the matter. In this respect, the Chamber started by acknowledging all the above-mentioned facts as well as the arguments and the documentation submitted by the parties. However, the Chamber emphasized 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. In this respect, the members of the Chamber acknowledged that on 15 August 2019, the parties had signed an employment contract, valid between 15 August 2019 and 30 June 2020, in accordance with which the player was entitled to receive, inter alia, the amount of EUR 135,000, payable in 8 equal instalments of EUR 16,875 each.

6. In continuation, the Chamber took note that the player had put the club in default on 8 May 2020 or the outstanding amount of USD 67,500, as according to the player, the cub had failed to pay him his monthly salaries between February and May 2020, however to no avail.

7. Moreover, the Chamber noted that on 7 June 2020, the player lodged a claim against the club, claiming the total amount of USD 67,500. However after the club in the scope of the current proceedings paid the total amount of USD 67,500 on 7 August 2020, the player amended his claim, asking to be awarded the amount of USD 8,304, plus 5% interest p.a. as from 7 August 2020 and to be provided with a tax certificate. The amount of USD 8,304 allegedly consisted of the amount of USD 3,375 as outstanding interest for the period between 5 February 2020 and 8 August 2020, as well as the amount of USD 4,168.84 as ‘exchange rate loss between USD and EUR’.

8. Equally, the members of the Chamber took note of the reply of the club, which asserted that it had already paid the net amounts as per the contract, the player was entitled to and that therefore, there is no obligation to pay any further ‘interest or currency value fluctuation’. In conclusion, the club asked for the rejection of the player’s claim.

9. With due consideration to the above, the members of the Chamber acknowledged that the central issue in this matter is the question whether or not the club should be obliged to pay the player the amounts claimed as overdue interest and exchange rate loss.

10. In this respect, the members of the DRC first of all 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.

11. According to the aforementioned principle, the DRC noted that the player did not submit any corroborating documentary evidence, on the basis of which it could be concluded that he had indeed suffered an ‘exchange loss’ due to the currency fluctuation between the USD and the EUR. What is more, the player could also not sufficiently demonstrate that the club had to be held responsible for the difference between the payment of an amount in USD and the receipt of an amount in EUR, even more because the contract between the parties only stipulated that amount shad to be paid in USD.

12. In view of the foregoing, the Chamber decided to reject the part of the player’s claim related to the amount of USD 4,168.34 as ‘exchange rate loss between USD and EUR’.

13. What is more, as to the player’s request for interest because of the late payment of the amount of USD 67,500 by the club, the Chamber concluded that the player had claimed said interest, as well as the main amount of USD 67,500 from the beginning of this procedure. What is more, the DRC noted that the amount of USD 67,500 was eventually paid by the club on 7 August 2020, whereas it should have been paid in four instalments of USD 16,875 each on respectively 5 February, 5 Mach, 5 April and 5 May 2020.

14. In view of the foregoing, the Chamber concluded that the player could validly claim an amount of interest for the period between the due date of the respective payment (6th day of the following month) and the effective date of payment of said instalment (7 August 2020). What is more, the DRC noted that the club has not provided evidence that it also duly paid the interest due to the player for the late payment of the total amount of USD 67,500.

15. As a consequence, and in accordance with the general legal principle of pacta sunt servanda, the Chamber deemed it correct to award the player the total amount USD 1,278.34, specified as follows:

Amount

Interest rate p.a.

From

To

Total days

Interest amount

USD 16,875

5%

06.02.2020

07.08.2020

183

USD 423.03

USD 16,875

5%

06.03.2020

07.08.2020

154

USD 355.99

USD 16,875

5%

06.04.2020

07.08.2020

123

USD 284.33

USD 16,875

5%

06.05.2020

07.08.2020

93

USD 214.98

USD 1,278,34

16. With regards to the claimed interests, the DRC concluded that no interest on interest shall be awarded and that therefore, this part of the claim should be rejected.

17. Finally, the DRC concluded its deliberations in the present matter by establishing that any further claim lodged by the player is rejected.

18. Furthermore, taking into account the consideration under number II./3. above, the Chamber referred to par. 1 and 2 of art. 24bis of the Regulations, which stipulate that, with its decision, the pertinent FIFA deciding body shall also rule on the consequences deriving from the failure of the concerned party to pay the relevant amounts of outstanding remuneration and/or compensation in due time.

19. In this regard, the Chamber pointed out that, against clubs, the consequence of the failure to pay the relevant amounts in due time shall consist of a ban from registering any new players, either nationally or internationally, up until the due amounts are paid and for the maximum duration of three entire and consecutive registration periods.

20. Therefore, bearing in mind the above, the DRC decided that, in the event that the club does not pay the amounts due to the player within 45 days as from the moment in which the player, following the notification of the present decision, communicates the relevant bank details to the club, a ban from registering any new players, either nationally or internationally, for the maximum duration of three entire and consecutive registration periods shall become effective on the club in accordance with art. 24bis par. 2 and 4 of the Regulations.

21. Finally, the Chamber recalled that the above-mentioned ban will be lifted immediately and prior to its complete serving upon payment of the due amounts, in accordance with art. 24bis par. 3 of the Regulations.

III. DECISION OF THE DISPUTE RESOLUTION CHAMBER

1. The claim of the Claimant, Rafael Lopez Gomez, is partially accepted.

2. The Respondent, Hyderabad FC, has to pay to the Claimant, the following amount:

- USD 1,278.34 as outstanding dues.

3. Any further claim lodged by the Claimant is rejected.

4. The Claimant is directed to immediately and directly inform the Respondent of the relevant bank account to which the Respondent must pay the due amount.

5. The Respondent shall provide evidence of payment of the due amount in accordance with this decision to psdfifa@fifa.org, duly translated, if applicable, into one of the official FIFA languages (English, French, German, Spanish).

6. In the event that the amount due, plus interest as established above is not paid by the Respondent within 45 days, as from the notification by the Claimant of the relevant bank details to the Respondent, the following consequences shall arise:

1. The Respondent shall be banned from registering any new players, either nationally or internationally, up until the due amount is paid and for the maximum duration of three entire and consecutive registration periods. The aforementioned ban mentioned will be lifted immediately and prior to its complete serving, once the due amount is paid.

(cf. art. 24bis of the Regulations on the Status and Transfer of Players).

2. In the event that the payable amount as per in this decision is still not paid by the end of the ban of three entire and consecutive registration periods, the present matter shall be submitted, upon request, to the FIFA Disciplinary Committee.

For the Dispute Resolution Chamber:

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).

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