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 18 February 2021

Decision of the

Dispute Resolution Chamber

passed on 18 February 2021

regarding an employment-related dispute concerning the player Giuliano Victor de Paula

COMPOSITION:

Omar Ongaro (Italy), Deputy Chairman

Elvis Chetty (Seychelles), member

Stijn Boeykens (Belgium), member

CLAIMANT / COUNTER-RESPONDENT 1:

GIULIANO VICTOR DE PAULA, Brazil

Represented by Mr Marcelo Amoretty

RESPONDENT / COUNTER-CLAIMANT:

AL NASSR, Saudi Arabia

Represented by Mr Daniel Muñoz

COUNTER-RESPONDENT 2:

ISTANBUL BASAKSEHIR, Turkey

Represented by Mr Sami Dinc

I. FACTS OF THE CASE

1. On 19 August 2018, the Brazilian player, Giuliano Victor de Paula (hereinafter: the player) and the Saudi club, Al Nassr (hereinafter: the club) concluded an employment contract (hereinafter: the contract) valid as from 18 August 2018 until 17 August 2021.

2. Clause 4.1 of the contract stipulates the remuneration of the player during the different seasons, as follows:

a. For the season 2018/2019: EUR 4,500,000 net divided in 12 monthly salaries of EUR 375,000 each payable between September and August; being 4 of those monthly salaries, i.e. EUR 1,500,000, payable “upon signing and executing this contract”;

b. For the season 2019/2020: EUR 4,500,000 net divided in 12 monthly salaries of EUR 375,000 each payable between September and August; being 4 of those monthly salaries, i.e. EUR 1,500,000, payable on 31 August 2019;

c. For the season 2020/2021: EUR 4,500,000 net divided in 12 monthly salaries of EUR 375,000 each payable between September and August; being 4 of those monthly salaries, i.e. EUR 1,500,000, payable on 31 August 2020.

3. Clause 4.2 of the contract establishes bonuses the player would be entitled to obtain, as follows. Such bonus was payable 60 days after the bonus target was reached:

“1- An amount of EUR 100,000 (one hundred thousand Euro) for each one of the flowing occasions: (12, 20, 30 goals/assists) in the official matches during the season.

2- An amount of EUR 350,000 (three hundred fifty thousand Euro) in case of achieving the title of Saudi League.

3- An amount of EUR 150,000 (one hundred fifty thousand Euro) in case of achieving the one of the King Cup, Arab Champions Cup or Champions League, limited to one championship in each season. 4- An amount of EUR 100,000 (one hundred thousand Euro) in case of finishing the Saudi League in the second or third place.”

4. Clause 4.3 of the contract establishes the additional retributions in favour of the player:

a. 3 round-trip business class tickets between Brazil and Saudi Arabia per year;

b. 6 round-trip economy class tickets between Brazil and Saudi Arabia per year;

c. 2 luxury cars with driver for the term of the contract;

d. A luxury house;

e. Tuition fee of the school for the player’s children;

f. Medical insurance for the player and his family.

5. Clause 9.5 of the contract stated as follows: “The parties agree on a buy-out clause of EUR 10,000,000 (ten million Euro) net of any taxes, bank charges and solidarity contribution implying that if the club receives such an offer from a third club or the player himself, it will agree to release the player.”

6. On 19 July 2019, the player put the club in default of payment of the following, granting the club with a deadline of 15 days to cure the breach:

a. his monthly salaries of June and July of EUR 375,000 each;

b. EUR 100,000 as bonus for achieving 20 goals/assists on 19 February 2019;

c. EUR 350,000 as bonus for winning the Saud League on 16 May 2019;

d. SAR 31,440.50 as medical and school expenses.

7. On 20 August 2019, the player reiterated his previous letter and awarded the club with additional 7 days to cure the breach.

8. On 19 December 2019, the player put the club in default of payment of EUR 750,107 corresponding to the unpaid portion of his advance salaries payable on 31 August 2019, granting the club with a deadline of 15 days to cure the breach.

9. On 13 April 2020, the Saudi Professional League issued a circular letter advising all Saudi clubs to apply 50% reductions on the salaries of players, coaches and technical staff upon the suspension of all sporting activities due to Covid-19.

10. On 15 April 2020, the club sent a circular letter to the players, informing them, inter alia, that the club would “initiate a bilateral resolution in line with the relevant laws and declarations adjudicating the outbreak of COVID-19” in view of the negative financial impact caused upon the outbreak of Covid-19.

11. On 22 April 2020, the player sent a letter dated 21 April 2020 to the club, whereby he informed the latter about his non-acceptance to the 50% reduction on his salaries and suggested negotiating an eventual reduction in the form of a bilateral resolution. (note: the claimant explained that after an alleged telephone conversation maintained between the player and the Vice President of the club club, the latter informed the player that a 50% reduction on the salaries would be applied as from 15 March 2020 until the date of the effective return of sport activities. As a consequence thereof). Moreover, the player put the club in default of payment of EUR 1,225,000, broken down as follows:

a. Salaries of February, March and April 2020: EUR 1,125,000

b. Bonus for 12 goals/assists accomplished on 19 December 2019: EUR 100,000.

12. By means of his letter dated 17 June 2020, the player put the club in default of payment of the salaries of February, March, April and May 2020, in the amount of EUR 1,500,000 as well as individual bonuses in the amount of EUR 200,000 (EUR 100,000 each for 12 and 20 goals/assist accomplished) and granted the club a 15 days’ deadline to remedy the default.

13. On the same date, 17 June 2020, the club sent a correspondence to the player informing him that a collective agreement was reached with the players.

14. In this context, on 18 June 2020, the player sent another correspondence to the club, requesting information from the latter as to the said collective agreement and stressed that he was never part of the discussions.

15. The club replied thereto via a letter dated 19 June 2020, whereby it informed the player that: (a) it did not receive his letters of 21 April and 17 June 2020; (b) that the negotiations for the collective agreement were made through the captain of the team; and (c) that the player was the only player who did not sign the collective agreement.

16. By means of a letter dated 21 June 2020, the player put the club in default of payment of the total amount of EUR 2,075,000 corresponding to the salaries of February, March, April, May and June 2020, in the amount of EUR 1,875,000 as well as individual bonuses in the amount of EUR 200,000 (EUR 100,000 each for 12 and 20 goals/assist accomplished) and granted the club a 15 days’ deadline to remedy the default.

17. On the same date, 21 June 2020, the player sent a second letter to the club whereby the former stressed that, as far as he knew, at least 2 other players did not sign the said collective agreement and that he was “open to discuss a solution other than the 50% reduction”.

18. On 22 June 2020, the club replied thereto and informed the player that it was acting in accordance with the FIFA guidelines issued in the FIFA Circular no. 1714. Moreover, the club stressed that it was 90% of the players who signed the collective agreement. Furthermore, the club offered the player to have an online meeting with one of his lawyers on the following day, 23 June 2020.

19. On 23 June 2020, the club sent a letter to the player reiterating its invitation for the player to meet with the club and amicably solve the matter.

20. On 24 June 2020, the parties allegedly had a meeting, where the club insisted on the 50% reduction on the player’s salaries and the player offered alternatives such as the early termination of the contract at the end of the current season “without the necessity of any kind of payment for any of the parties”; however, to no avail.

21. On 25 June 2020, the club informed the player that it had issued a decision and as such would enforce a 50% reduction on the player’s salaries during the period of suspension of sporting activities.

22. By means of his letter dated 28 June 2020, the player expressed to the club his non-acceptance of the unilateral decision taken by the club to reduce his earnings and further put the club in default of payment of the salaries of February, March, April, May and June 2020 in the amount of EUR 1,875,000 as well as individual bonuses in the amount of EUR 200,000 and granted the club a 15 days’ deadline to remedy the default.

23. On 28 June 2020, the club sent a correspondence to the player, informing the latter that it had proceeded with the payment all outstanding amounts in the total value of EUR 1,236,80, broken down as follows:

a. EUR 375,000 as salary of February;

b. EUR 282,361 as pro-rata salary of March;

c. EUR 189,722 as salary of April;

d. EUR 189,722 as salary of May;

e. EUR 200,000 as bonuses.

24. On 23 July 2020, the player filed a claim before FIFA against the club. The case was filed under ref. 20-01053. The player requested to be awarded outstanding remuneration in the amount of EUR 592,817, plus 5% interest p.a. as from the corresponding due dates until the date of effective payment, broken down by the player as follows:

a. EUR 92,639 corresponding to the unpaid part (50%) of the last 15 days of the salary of March 2020;

b. EUR 185,278 corresponding to the unpaid part (50%) of the salary of April 2020;

c. EUR 185,278 corresponding to the unpaid part (50%) of the salary of May 2020;

d. EUR 129,622 corresponding to the unpaid part (50%) of the 20 first days of the salary of June 2020.

25. By means of his letter dated 7 September 2020, the player put the club in default of payment of EUR 2,250,000, corresponding to the salaries of July and August 2020 in the amount of EUR 750,000 as well as the advance salaries due on 31 August 2020 amounting to EUR 1,500,000 and granted the club a 15 days’ deadline to remedy the default.

26. On 14 September 2020, the player wrote to the club again having acknowledged the club’s instruction that he would both not participate in the AFC Champions League and that he had to “rest” until 24 September 2020. Accordingly, he required the club authorization and issuance of an exit visa, since the one in his possession had apparently been cancelled. The player and his lawyer jointly signed the letter in question.

27. On 15 September 2020, the club responded and rejected the player’s position on the grounds that he was now apparently represented by a different person. On the same day, the player confirmed the representation and demanded an answer from the club.

28. On 16 September 2020, the club replied and informed the player that he apparently had not requested the “relevant football department for travelling abroad” and requested him to do so.

29. On the same day, the player responded stating his surprise as his exit visa had been granted by the club on September 9th and later had been cancelled. He reiterated his request of his exit visa. In reply, the club stated as follows: “Dear Giuliano, After verification it appears that visas were issued for the purpose of AFC mission in Qatar. Also up until this date you haven't submit a request for traveling abroad, please submit a request to the relevant department as illustrated previously and share with us a copy of that request once you decide to submit it as this department is not tasked to process such requests”.

30. The player’s lawyer promptly replied and stated as follows: “Dear Sir, This is absurd. It's clear to see the bad faith at the responses of the Club, it informs about a "relevant department" but it doesn't say which is and what is this new procedure, besides the administrative staff no answering our messages. Please inform us which is "relevant department" , their contact to request the authorization and what is the full procedure to request the exit visa. Again, the player has been at the Club for over 2 years and he has done the same procedure to request his exit visa all those times, through Mr. Badawi, who is not answering, neither Mr. Ghamdi. Anyway, if the player doesn't get a proper response, with his exist visa, we will start procederes with the Brazilian Embassy, FIFA and the Office of the United Nations High Commissioner for Human Rights (OHCHR). This is going too far”.

31. On 17 September 2020, the club replied to the player and stated as follows: “Dear Felipe, We reserve our legal and reputable rights against your false and inaccurate accusations and will undertake the necessary measure accordingly as the club has always acted in good faith with all its members. By way of illustration the commonly used concept of “relevant department” in guidance means: the department which an individual of the club relates and reports to on a daily basis in performing his duties, hence in the case of the football player Giuliano it’s the department of “Football”. Accordingly, we learn that Giuliano in many occasions submitted respective requests knowing fully the protocol (documents of previous requests by Giuliano are reserved in the archive and documented). For the avoidance of any doubt and in good faith we state for your convenience that his relevant department is the Football which can be reached in their working hours and here is an email for further assistance: A.ghamdi@alnassr.sa.”

32. On the same date, the player sent an e-mail to Mr. Ghamdi and stated as follows: “Hello Mr. Ahmed Ghamdi, Even though I never used this email before to request my exit visa, I need my exit visa immediately, so I can enjoy my last few days of rest somewhere else. Can you prepare the exit visa and send to me immediately? Since you’re not responding my messages I hope that through this email I can finally get your attention to my request. It’s my first time using this new procedural protocol of requesting visa through the “relevant department” and through this specific channel “email”, so I hope to hear from you soon. By the way, the Club should inform the rest of the foreigners players of the team of the new protocol, because they are still using messages and phone calls to request their visas. Is there anything else that I need to do? Regards, Giuliano”.

33. In reply, Mr Ghamdi stated as follows: “Dear Giuliano, Thank you for your email. I remind you that you did follow the protocol in numerous occasions and filled such requests which are documented and archived. Having established the above, I notify you that after getting back to the administration they don’t mind your travel but please fill the request form with the exact date of departure, arrival and destiny in order to issue a visa for that purpose. Best, Ahmed”.

34. Replying to the above message, the player wrote as follows: “Mr. Ghamdi, I have no recollection of fulfilling any request form in the past for traveling abroad, it was always the same procedure, talking to you or Mr. Badawi over the phone or through messages. It is important to mention that I just asked Petros and Musa if they sent an email or fulfilled any document to request the exit visa and they said “no, we just asked Ahmed and Badawi”. I have proof of those conversations. Anyway, why you didn’t sent the request form attached in the email for me to fulfill? I am just losing time with this email exchanges. Do I need to go to the Club to fulfill the request? Why you are not answering my calls and messages as well? Date of departure: 18 September 2020 Date of return: 24 September 2020 (I will be in Riyadh for training) Destiny: Dubai Please, tell me exactly what I need to do to get my exit visa. I already lost 7 days of my time off. Regards, Giuliano”.

35. On 18 September 2020, the player wrote to the club and stated the following: “Hello Mr. Ghamdi, I still haven’t heard back from you, I need a immediately answer because I need to organize my trip with my family. Analyzing this week exchange of emails, looks clear to me that although you say on your last email that the Club authorized my traveling, this new bureaucracy established by the Club will make sure I don’t get the visa today. Probably the argument is that today is weekend or whatever other excuse the Club will use to keep me here. I really hope you can prove me wrong and send my exit visa today. I feel powerless and trapped here in this country right now. I never imagined that I would see this in my career, a Club limiting my freedom and my right to come and go. If my visa is not granted today, I will take legal action, what is happening is absurd. Please answer my calls and my messages. Counting on you my friend. Regards, Giuliano”.

36. On 19 September 2020, the club wrote to the player and stated as follows: “Dear Giuliano, As affirmed before the club does not mind granting visa or travel. In relation to your statement “I have no recollection of fulfilling any request form in the past for traveling abroad” I hardly urge you to act in good faith and refrain from falsifying facts and misleading claims for unclear purposes, to your note the club reserve its legal right towards your false accusations and will take the appropriate measure accordingly. (Attached some of your previous requests which you submitted in the past extracted from your file). As illustrated please fill the blank request in the same manner as you did with your other requests. Best,”.

37. On the same date, the player filled out the cited form and sent it to the club.

38. On 21 September 2020, the club answered the player’s letter of 7 September and rejected the player’s position. The club did not deny that the player was entitled to four salaries as advance payment but claimed that “said advance payment cannot be considered as binding because the circumstances on which it was agreed changed drastically and the provision no longer meets the intention of the parties when entering into the employment contract”. The club argued that the true intention of the parties was that payment was performed a week after the closure of the summer transfer window in Saudi Arabia. Accordingly, the club established that it would pay EUR 1,500,000 by 19 November 2020. Additionally, the club recognized that the salaries of July and August were due and asked the player for his “co-operation in good faith to engage in a discussion to find a date within the following weeks on which Al Nassr Saudi can pay the salaries of July 2020 and August 2020”. Finally, the club rejected that the player would have just cause to terminate the contract and stated that it “recommend the Player to abstain from terminating his Employment Contract with Al Nassr Saudi and to refrain from his unlawful line of action in detriment of the Club”.

39. On 23 September 2020, the player sent a letter to the club whereby he rejected the club’s argumentation and further referred to the visa situation. The player furthermore referred to the fact that despite the COVID-19 economic crisis argued by the club, it was still hiring new players. The player, subject to his exit visa being granted in 24 hours, granted the club with five additional days to cure its contractual breach of missed payment of EUR 2,250,000.

40. On 24 September 2020, the club responded to the player’s letter and denied that his exit visa had been denied or withheld and informed that such visa would be granted by 27 September 2020 due to local weekend and holiday. The club further argued that it was its understanding that the 5-day grace period would elapse on 30 September 2020.

41. On 25 September 2020, the player replied to the club and clarified that the 5-day grace period would elapse on 28 September 2020 as per his correspondence of 23 September 2020. The player confirmed that it was his understanding that his exit visa would be granted on 27 September 2020.

42. On 27 September 2020, the club wrote to the player via e-mail and stated as follows: “Dear Giuliano, Your visa as promised has been filled for and you will receive it within the next hours. Can you please amend the form with new dates. Regards, Ahmad”. On the same date, the player replied and stated as follows: “Follow in attached the travel request fulfilled as you ask. I am booking my flight for later tonight, for that I need the exit visa for the next two hours, please send me asap. Regards, Giuliano”.

43. On 28 September 2020, the club wrote to the player again and reiterated its position explained in its letter of 21 September 2020. The club confirmed that it deemed the player not entitled to terminate the contract and that it was not obliged to pay the advance payment of EUR 1,500,000 by 31 August 2020. It further warned that in case the player breached the contract he would have to pay compensation of at least EUR 10,000,000.

44. On 29 September 2020, the player terminated the contract in writing based on outstanding salaries as per art. 14bis of the Regulations on the Status and Transfer of Players (RSTP). He explained that the situation with the club was “unbearable” due to the missed payments and the exit visa issue.

45. On 5 October 2020, the player and the Turkish club, Istanbul Basaksehir (hereinafter: Istanbul) executed an employment contract valid as from the same date until 31 May 2023. According to such contract, the player was entitled to the inter alia following remuneration:

a. EUR 1,500,000 for the season 2020/2021, of which EUR 250,000 would be paid as advance payment on 31-10-2020 and the remaining in 10 equal instalments between Oct-20 and May-21;

b. EUR 2,250,000 for the season 2021/2022, of which EUR 500,000 would be paid as advance payment on 31-07-2021 and the remaining in 10 equal instalments between Aug-21 and May-22;

c. EUR 2,250,000 for the season 2021/2022, in 10 equal instalments between Aug-22 and May-23.

46. Following a dispute related to the issuance of the player’s ITC, on 14 October 2020, the Single Judge of the Players’ Status Committee granted the provisional registration of the player with Istanbul and highlighted that “The present decision is a provisional measure, and, as such, without prejudice to any possible decision from the Dispute Resolution Chamber (DRC) and/or the competent deciding body on the substance of the potential contractual dispute between the player and his former club (as well as his new club)”.

47. According to the information available in the Transfer Matching System (TMS), between 1 March 2020 and 30 September 2020, the club engaged a few players. In particular, the club hired:

a. Mr. Gonzalo Martinez from Atlanta United FC against payment of USD 16,000,000 in September 2020, the first instalment of which amounts to USD 4,875,000 and fell due on 17 September 2020 in accordance with the relevant transfer agreement;

b. Mr. Jinsu Kim from Jeonbuk Hyundai FC for USD 1,000,000 in October 2020, the first and second instalments of which amount to USD 350,00 each and fell due respectively on 14 September 2020 and 14 December 2020 in accordance with the relevant transfer agreement;

c. Mr. Maicon Pereira Roque from Galatasaray for EUR 1,100,000, payable in full by 14 August 2020.

II. PROCEEDINGS BEFORE FIFA

48. On 6 October 2020, the Claimant filed the claim at hand before FIFA. A brief summary of the position of the parties is detailed in continuation.

a. The claim of the player

49. The player filed the claim at hand and claimed that he had just cause under article 14bis RSTP to terminate the contract. The player advanced the following arguments:

 The club was frequently late in payment of the player’s remuneration and had to be multiple times notified to comply with the contract. In particular, the player outlined that the club failed to pay him his salaries of July and August 2020, amounting to a total of EUR 750,000 in spite of having being put in default on 7 September 2020 and being awarded 15 days to cure the contractual breach;

 Equally, the club failed to pay the player his advance payment of EUR 1,500,000 which fell due on 31 August 2020. The player argued as follows: “The Claimant has the undiscussable right to ask for a payment that was due in a specific date. It doesn’t matter if it was concerning a payment of an advance of four months of his yearly payment. All that the Claimant wanted was to receive the dues to continue playing for the Respondent. No justification can be brought by the Respondent to rationalize the non-payment or the payment in a different date from what it’s stated in the contract. The fact that the payment was an advance payment for months that the Claimant didn’t play yet cannot justify the authorization for tardiness, because it was agreed in that way in the contract negotiations, and should be respected”;

 The player highlighted the situation concerning his exit visa and explained that on 9 September 2020 he played the last match of the local league, being thereafter not enrolled for the upcoming match regarding the AFC Champions League and awarded a “time-off” until 24 September 2020. He explained that he received his exit visa, only to be “surprised” on 13 September 2020 with the information that his visa had been cancelled. The player claims he used the proper channels to obtain assistance from the club as he had always done; yet the club failed to act properly, leaving the player in a situation where he was trapped in Saudi Arabia.

 In continuation, the player addressed the fact that the club failed to pay him his remuneration while at the same time hired foreign and domestic players. The player outlined as follows: “The Respondent claims to have been impacted by COVID-19, but has already made unilateral reductions of the players' salaries, in the proportion of 1.7 (one point seven) month salaries for the entire squad and, in an unbelievable way, it has carried out transfers of new international and national players. If you are unable to pay your current players, how can you justify the arrival of new players?”

 The player further rebutted the argumentation brought forward by the club in its correspondences and denied that he would have a financial gain by leaving the club since he could not earn a salary as high as it was with the club due inter alia to the COVID crisis. The player furthermore rejected the argumentation of the club that he would have to pay EUR 10,000,000 since “the clause was not connected to any compensation for a contract termination for just cause to neither side”. However, the player argued that “since the Respondent has this interpretation and since the Respondent is the one that gave clear and undisputable motive for the termination with just cause for outstanding salaries, breaching the contract and recognizing in its notices, the Claimant feels compelled to ask for compensation in the amount of EUR 10,000,000 (ten million euros) from the Respondent, since the Respondent breached the contract by the lack of payment”.

 The player further claimed that he was entitled to EUR 100,000 as bonus since the club finished in the second place in the Saudi League. He furthermore argued that the club was still playing in the Saudi King Cup semi-finals and that in the event the club won such tournament, the player would be entitled to EUR 150,000.

50. The requests of relief of the player were as follows:

“a) declare that the contract between the Claimant and the Respondent is terminated with just cause for outstanding salaries, based on article 14bis of the FIFA Regulations on the Status and Transfer of Players, as from 29 September 2020;

b) condemns the Respondent to pay to the Claimant the amount equal to EUR 750,000 (seven hundred and fifty thousand euros), as outstanding salaries for the months of July and August 2020;

c) condemns the Respondent to pay to the Claimant the bonus for the second place in the Saudi League, described in item 4, number 2, sub number 4, in the amount of EUR 100,000 (one hundred thousand euros);

d) condemns the Respondent to pay to the Claimant the bonus described in item 4, number 2, sub number 3, in the amount of EUR 150,000 (one hundred and fifty thousand euros), in the event the Respondent achieve the title of the King Cup;

e) condemns the Respondent to pay to the Claimant a compensation in the amount of EUR 10,000,000 (ten million euros) net, according to the understanding of the Respondent that this is the amount to be paid as compensation for breach of contract;

f) alternatively, in the event this Court understand the said amount is not the right one to be used as compensation in this specific case, condemns the Respondent to pay to the Claimant a compensation in the amount of EUR 4,500,000 (four million and five hundred thousand euros) net, equivalent to the remaining remuneration of the Claimant, as from 29 September 2020 (rescission date) to 17 August 2021, as compensation;

g) adopts the pertinent disciplinary sanctions for cases of non-compliance with a possible FIFA decision until the moment the Respondent makes the payment of the amounts owed to the Claimant, according to article 64, paragraph 1, letter c) of FIFA Disciplinary Code;

h) orders the Respondent to repay to the Claimant any contribution towards the legal and other costs incurred and regarding the ongoing proceeding in an amount to be duly established at discretion of the this Court.”

b. Reply and counterclaim of the club

51. Before FIFA invited the club to provide its position on the claim of the player, the club filed a parallel claim against the player and Istanbul. For procedural economy, such parallel claim was deemed as a counterclaim. The club was also invited to file its response, which it did.

52. The club argued as follows:

 The player did not have just cause to terminate the contract. The club argued that just cause must be assessed on a case-by-case basis and that the since the FIFA RSTP “do not provide an unequivocal definition of what constitutes a just cause for termination of the Employment Contract, we must look at the other sources of the Applicable Law to find an answer to that question. In this case, the other source of law to be applied is Swiss Law”. Consequently, the club turned to Swiss Law as well as to CAS Jurisprudence, and argued that under art. 337 SCO it is up for the court to examine whether just cause exists. The club explained that termination of a contract must always be an ultima ratio and proceeded to explain why the termination by the player did not comply with said principle.

 In continuation, the club denied that it cancelled and refused to issue the player’s exit visa. The club’s position is that it only requested the player to follow proper procedure. The club also stated that the player acknowledged that his visa would be issued on 27 September 2020 and that “the totality of circumstances it is evident that the issue of the exit visa was not so severe for the Player in a way that could allow him to justify the termination of the Employment Contract with Al Nassr”.

 The club furthermore argued that it paid the player’s family school expenses and provided him with a luxury car and housing. As such, the club is of the position that “it is of paramount importance to highlight that it is simply ridiculous that a Player that has received more than €8.400.000 net during the term of the Employment Contract, tries to sustain that the fact that the Club supposedly did not provide him with the agreed cars could be consider as a further reason to justify his contractual termination”. The club also claimed that the player failed to provide evidence of his medical expenses.

 The club is of the position that the reasons put forward by the player cannot justify the termination of the contract. In this respect, the club claimed in line with its letter of 21 September 2020 that the advance payment of EUR 1,500,000 for the season 2020/2021 was not due before 19 November 2020 on the grounds that the true intention of the parties was that payment was performed a week after the closure of the summer transfer window in Saudi Arabia. The club furthermore argued that it would be illogical to follow the player’s reasoning since “the concept of “advance payment” is precisely paying in advance what the Player has the right to receive during the season. Therefore, this payment would only make sense if the Player is entitled to receive the salaries during the relevant season”.

 The club also argued that the delay in payment of two monthly salaries “does not entitle the Player to terminate the Employment Contract under the very particular conditions of this dispute” even with the application of art. 14bis of the RSTP. The club argued that FIFA declared COVID-19 a force majeure situation, following which the Saudi Arabian FA “embraced this position”.

 The club highlighted that the player did not seek an amicable solution and that the club “has been working tirelessly to find its way around its financial difficulties. It has been forming a highly competitive squad that can allow it to succeed domestically and internationally, all in order to cure its loses with the money coming from prices, broadcasting right and revenues from media exposure, marketing, etc.”

53. Based on the foregoing, the club argued that the player did not have just cause to terminate the contract and requested him to be order to pay EUR 12,500,000 net as compensation for breach of contract plus 5% interest p.a. as from the date of termination of the contract until the effective date of payment. The club also requested that Istanbul be deemed jointly and severally liable for payment of such compensation. The club arrived at such amount due to clause 9.5 of the contract added to EUR 2,250,000 as additional compensation under the specificity of sport. The club further requested the imposition of sporting sanctions.

54. Alternatively, the club submitted that, should it be found that the player terminated the contract with just cause, the amount of compensation be either (a) set aside since the player contributed to the termination of the contract; or (b) reduced due to the player’s new remuneration with Istanbul.

55. Finally, in any case, the club requested that the player’s claim for bonuses be rejected, on the grounds that he (a) did not file evidence to the final standings of the Saudi League and (b) had already left the club on his own initiative before the final of the King’s Cup had taken place.

c. Reply to the counterclaim by the player

56. In his answer to the club’s counterclaim, the player rejected the club’s position and reiterated his own.

57. The player denied that the contract was performed adequately by the club since his payments were always in delay, the club never provided the car’s drivers, and the medical insurance was provided with a one-year delay. Also, the player reiterated that he had to pay for his children’s school tuition in spite of the contractual obligations.

58. In continuation, the player addressed the COVID-19 pandemic and reiterated that the case has no connection to the unilateral reduction of his salaries. The player further highlighted that the club continued to hire players for substantive amounts in spite of the COVID-19 pandemic, which contradicts the club’s position that COVID-19 had a “strong impact” on the club.

59. The player furthermore rejected the club’s position that he wanted to leave the Club in the summer transfer window of 2020/2021, and underlined that the club provided no evidence in this regard. The player stressed that a letter sent by Al Nassr Dubai showing interest in hiring his services does not demonstrate that the player wanted to leave. Additionally, the player rejected the club’s assertion that he was not willing to cooperate and filed evidence of a tentative settlement agreement engaged between the parties.

60. With regards to the advance payment of EUR 1,500,000, the player referred to the contract and claimed that the wording found therein was clear. The player refuted that his intention upon conclusion of the agreement was that the advance payment was made one week after the closure of the transfer window in Saudi Arabia. He reiterated furthermore that he had just cause to terminate the contract under art. 14bis of the RSTP.

61. Lastly, the player filed evidence of the final standings of the Saudi League.

d. Reply to the counterclaim by Istanbul

62. In its reply to the claim, Istanbul argued that the player terminated the contract with just cause in line with art. 14bis RSTP. Consequently, Istanbul stated that the consequences foreseen in article 17 of the RSTP shall not apply against it.

63. Alternatively, Istanbul argued that it did not induce the player to breach the contract as the player’s hiring took place “at the last minute” and given the fact that Istanbul never spoke to the player before the termination of the contract.

64. Istanbul requested that the counterclaim be dismissed, or, in the alternative, that compensation, if awarded, is reduced. It further requested that no sporting sanctions apply and that the club is ordered to pay CHF 10,000 as a contribution towards Istanbul’s legal fees.

III. CONSIDERATIONS OF THE DISPUTE RESOLUTION CHAMBER

a. Competence and applicable legal framework

65. 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 presented to FIFA on 6 October 2020 and submitted for decision on 18 February 2021. Taking into account the wording of art. 21 of the January 2021 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.

66. Subsequently, the members of the Chamber referred to art. 3 par. 1 of the Procedural Rules and observed that in accordance with art. 24 par. 1 in combination with art. 22 lit. a) and b) of the Regulations on the Status and Transfer of Players (edition January 2021), the Dispute Resolution Chamber is competent to deal with the matter at stake, which concerns an employment-related dispute with an international dimension between a Brazilian player, a Saudi club, and a Turkish club.

67. Subsequently, the Chamber analysed which regulations 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 Player (edition January 2021), and considering that the present claim was lodged on 6 October 2020, the October 2020 edition of said regulations (hereinafter: the Regulations) is applicable to the matter at hand as to the substance.

b. Burden of proof

68. 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. Likewise, the DRC stressed the wording of art. 12 par. 4 of the Procedural Rules, pursuant to which it may consider evidence not filed by the parties.

69. In this respect, the Chamber also recalled that in accordance with art. 6 par. 3 of Annexe 3 of the Regulations, FIFA’s judicial bodies may use, within the scope of proceedings pertaining to the application of the Regulations, any documentation or evidence generated or contained in TMS.

c. Merits of the dispute

70. The competence of the DRC and the applicable regulations having been established, the DRC entered into the merits of the dispute. In this respect, the DRC started by acknowledging all the above-mentioned facts as well as the arguments and 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.

i. Main legal discussion and considerations

71. The foregoing having been established, the Chamber moved to the substance of the matter and took note of the fact that the parties strongly dispute whether the player had just cause to terminate the contract. The Chamber equally took due note of the club’s argumentation regarding the effects of the COVID-19 pandemic.

72. In this context, the Chamber firstly wished to highlight that FIFA issued a set of guidelines, the COVID-19 Guidelines, which aim at providing appropriate guidance and recommendations to member associations and their stakeholders, to both mitigate the consequences of disruptions caused by COVID-19 and ensure that any response is harmonised in the common interest. Moreover, on 11 June 2020, FIFA has issued an additional document, referred to as FIFA COVID-19 FAQ, which provides clarifications on the most relevant questions in connection with the regulatory consequences of the COVID-19 outbreak and identifies solutions for new regulatory matters.

73. The DRC also wished to refer to the fact that said guidelines – as per the explicit wording of FAQ no. 16, as well as pages 6 and 7 of the FIFA COVID-19 Guidelines – are only applicable to “unilateral variations to existing employment agreements”. Therefore, except where a termination of a contract occurred following a unilateral variation made as a result of COVID-19 (in which case the validity of the variation must first be assessed under the guidelines), said guidelines do not apply to assess unilateral terminations of existing employment agreements. The Chamber further noted that for the assessment of disputes that are presented before the FIFA judicial bodies concerning the unilateral termination of a contract, the FIFA Regulations as well as the established jurisprudence of the Chamber shall apply.

74. To this end, the Chamber highlighted that the events at the center of the dispute pertain to facts that have no connection to the unilateral reduction of the player’s salaries. Hence, the Chamber confirmed that it does not need to look into the FIFA COVID-19 Guidelines or the FIFA COVID FAQ.

75. In this respect, and moving into the issue of the termination, the DRC noted that it stood undisputed that the club defaulted payment of at least two salaries of the player, namely July and August 2020. The club confirmed this and did not argue that these payments were subject to any reduction.

76. Furthermore, the Chamber took due note of the fact that the player put the club in default of payment of inter alia these two salaries on 7 September 2020, awarding the club with 15 days to cure its breach, and later terminated the contract on 29 September 2020. Accordingly, the Chamber found that the criteria enshrined in art. 14bis of the Regulations was met by the player.

77. The DRC was observant of the argumentation by the club that said art. 14bis cannot apply to the case at hand, and that the Regulations “do not provide an unequivocal definition of what constitutes a just cause for termination”. The DRC was firm to set aside this line of argumentation under the clear and unambiguous contents of said article and the well-established practice of the Dispute Resolution Chamber. In this respect, the Chamber clarified that it sufficed that two monthly salaries had undisputedly remained unpaid by the club, hence it did not need to examine the matter of the payment of EUR 1,500,000 by the club.

78. For the sake of completeness, the DRC underlined that as per the documentation on file, contemporary or later to the time when the player’s remuneration was due, the club hired new players. Hence, the DRC confirmed that the club appeared to possess the means to cure its contractual breaches had it wished to do so.

79. Based on the foregoing, the DRC decided that the player had just cause to terminate the contract. The club is hence liable for the consequences that follow.

ii. Consequences

80. Having stated the above, the Chamber turned its attention to the question of the consequences of such unjustified breach of contract committed by the club.

81. The Chamber observed that the outstanding remuneration at the time of termination, are equivalent to two salaries under the contract, i.e. July and August 2020, amounting to a total of EUR 750,000 net (i.e. EUR 375,000 net each).

82. Additionally, the DRC noted that the player was entitled to a bonus of EUR 100,000 net, corresponding to the final standings of the club in Saudi league, evidence of which has been properly adduced by the player. The DRC concluded thus that the player is to be awarded that amount.

83. As to the bonus regarding the King’s Cup, the Chamber noted that such amount did not seem exactly requested by the player, or at least was requested in an unusual matter. In any event, the DRC noted that there was no evidence on file as to the final outcome of such tournament, and decided that that bonus could not be awarded.

84. As a consequence, and in accordance with the general legal principle of pacta sunt servanda, the Chamber decided that the club is liable to pay to the player the amounts which were outstanding under the contract at the moment of the termination, i.e. EUR 850,000 net.

85. Having stated the above, the Chamber turned to the calculation of the amount of compensation payable to the player by the club in the case at stake. In doing so, the Chamber firstly recapitulated that, in accordance with art. 17 par. 1 of the Regulations, the amount of compensation shall be calculated, in particular and unless otherwise provided for in the contract at the basis of the dispute, with due consideration for the law of the country concerned, the specificity of sport and further objective criteria, including in particular, the remuneration and other benefits due to the player under the existing contract and/or the new contract, the time remaining on the existing contract up to a maximum of five years, and depending on whether the contractual breach falls within the protected period.

86. In application of the relevant provision, the Chamber held that it first of all had to clarify as to whether the pertinent employment contract contained a provision by means of which the parties had beforehand agreed upon an amount of compensation payable by the contractual parties in the event of breach of contract. In this regard, the Chamber observed that the player requested the amount of EUR 10,000,000 net as compensation for breach of contract in accordance with clause 9.5 of the contract.

87. The DRC then proceeded to examine if the clause at stake is indeed a clause establishing compensation payable in case of breach of contract. By doing so, the DRC recalled the wording of such clause, which reads: “The parties agree on a buy-out clause of EUR 10,000,000 (ten million Euro) net of any taxes, bank charges and solidarity contribution implying that if the club receives such an offer from a third club or the player himself, it will agree to release the player.”

88. The DRC found that such clause is clear and unequivocal: its wording reflects the possibility of a third party-offer for EUR 10,000,000 net. It followed that clause 9.5 constitutes the so-called buy-out clause and does not refer therefore to compensation for breach of contract; thus, it shall not apply.

89. As a consequence, the members of the Chamber determined that the amount of compensation payable by the club to the player had to be assessed in application of the other parameters set out in art. 17 par. 1 of the Regulations. The Chamber recalled that said provision provides for a non-exhaustive enumeration of criteria to be taken into consideration when calculating the amount of compensation payable.

90. Bearing in mind the foregoing as well as the claim of the player, the Chamber proceeded with the calculation of the monies payable to the player under the terms of the contract until its expiry date. Consequently, the Chamber concluded that the amount of EUR 4,500,000 net (i.e. the entire remuneration for season 2020/2021) serves as the basis for the determination of the amount of compensation for breach of contract.

91. In continuation, the Chamber verified as to whether the player had signed an employment contract with another club during the relevant period of time, by means of which he would have been enabled to reduce his loss of income. According to the constant practice of the DRC as well as art. 17 par. 1 lit. ii) of the Regulations, such remuneration under a new employment contract shall be taken into account in the calculation of the amount of compensation for breach of contract in connection with the player’s general obligation to mitigate his damages.

92. Indeed, the player found employment with Istanbul. In accordance with the pertinent employment contract, the player was entitled to EUR 1,500,000 net for the season 2020/2021. Therefore, the Chamber concluded that the player mitigated his damages in the total amount of EUR 1,500,000.

93. Subsequently, the Chamber turned its attention to art. 17 par. 1 lit. ii) of the Regulations, according to which a player is entitled to an additional compensation of three monthly salaries, subject to the early termination of the contract being due to overdue payables. In case of egregious circumstances, the additional compensation may be increased up to a maximum of six monthly salaries, whereby the overall compensation may never exceed the rest value of the prematurely terminated contract.

94. With the above in mind, the Chamber recalled that from the evidence on file, in particular the extensive exchange of correspondence between the player and the club, it transpires that the club was unwilling to cooperate with regards to the issuance of the player’s exit visa. Indeed, the player requested numerous times to be given his exit visa; however, with a significant delay by the club, which always posed additional requirements for the visa to be issued. Put differently, the club did not seem to genuinely cooperate, notwithstanding its obligation to adopt the necessary and immediate steps to deliver the exit visa to the player in order to allow him to travel freely.

95. In view of the foregoing, and on the basis of the information and documentation on file, the Chamber deemed that the threshold of egregious circumstances is met in the matter at hand and therefore decided to award the Claimant additional compensation corresponding to four monthly salaries, i.e. EUR 1,500,000 net, in accordance with the above-mentioned provision.

96. Consequently, on account of all of the above-mentioned considerations and the specificities of the case at hand, the Chamber decided that the club must pay the amount of EUR 4,500,000 net to the player (i.e. EUR 4,500,000 minus EUR 1,500,000 as mitigation plus EUR 1,500,000 as additional compensation), which was to be considered a reasonable and justified amount of compensation for breach of contract in the present matter.

iii. Compliance with monetary decisions

97. Finally, taking into account the applicable Regulations, 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.

98. In this regard, the DRC highlighted 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.

99. 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 communicates the relevant bank details to the club, provided that the decision is final and binding, 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.

100. The DRC recalled that the above-mentioned bans 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.

101. Lastly, the DRC concluded its deliberations by rejecting any other requests for relief made by any of the parties.

d. Costs

102. The Chamber referred to article 18 par. 2 of the Procedural Rules, according to which “DRC proceedings relating to disputes between clubs and players in relation to the maintenance of contractual stability as well as international employment related disputes between a club and a player are free of charge”. Accordingly, the Chamber decided that no procedural costs were to be imposed on the parties.

103. Likewise and for the sake of completeness, the Chamber recalled the contents of art. 18 par. 4 of the Procedural Rules, and decided that no procedural compensation shall be awarded in these proceedings.

REF 20-01441

Page 22 of 23

IV. DECISION OF THE DISPUTE RESOLUTION CHAMBER

1. The claim of the Claimant/Counter-Respondent 1, GIULIANO VICTOR DE PAULA, is partially accepted.

2. The counterclaim of the Respondent/Counter-Claimant, AL NASSR, is rejected.

3. The Respondent/Counter-Claimant has to pay to the Claimant/Counter-Respondent the following amounts:

- EUR 850,000 net as outstanding remuneration;

- EUR 4,500,000 net as compensation for breach of contract without just cause.

4. Any further claims of the Claimant/Counter-Respondent 1 are rejected.

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

6. The Respondent/Counter-Claimant 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).

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

 1.

The Respondent/Counter-Claimant 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.

8. This decision is rendered without costs.

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).

CONTACT INFORMATION:

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