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 28 January 2021
Decision of the
Dispute Resolution Chamber
Passed on 28 January 2021
regarding an employment-related dispute concerning the player Juan Luis
Anangonó León
COMPOSITION:
Clifford J. Hendel (USA/France), Deputy Chairman
Stéphane Burchkalter (France), member
Todd Durbin (USA), member
CLAIMANT:
Juan Luis Anangonó León, Ecuador
Represented by Mr Jaime Castillo & Mr Danilo Monti
RESPONDENT:
Beijing BSU FC, China
I. FACTS OF THE CASE
1. On 15 July 2019, the Ecuadorian player, Juan Luis Anangonó León (hereinafter: Claimant
or player) and the Chinese club, Beijing BSU FC (hereinafter: Respondent or club) signed an
employment contract for a period of two years, starting on 15 July 2019 and ending on 14
July 2021.
2. According to art. 5 of the employment contract, the player was entitled to the following
remuneration:
From 15 July 2019 to 14 July 2020: USD 599,998 net divided into twelve monthly
instalments (note: the contract does not specify the amount of the monthly
instalments but provides that they are equal instalments: USD 599,998 / 12 = USD
49.999.83),
From 15 July 2020 to 14 July 2021: USD 599,998 net divided into twelve monthly
instalments.
3. The player was also entitled to the following fringe benefits:
4 sets of international one-way economy class air tickets for season 2019
(between South America and Beijing),
6 sets of international one-way economy class tickets for season 2020 (between
South America and Beijing). According to the player, although the English version
of the contract states that these tickets correspond to 2019, this is a
typographical error as seen when compared to the Chinese version of the contract,
3 sets of international one-way economy class air tickets for the season 2021
(between South America and Beijing According to the player, although the
English version of the contract states that these tickets correspond to 2019,
this is a typographical error as seen when compared to the Chinese version of
the contract,
CNY 10,000 per month as a contribution for the Player’s housing rental
expenses (Art. 8.4 of the contract),
CNY 2,000 per month as a contribution for the Player’s transport within
Beijing (Art. 8.4).
4. Art. 11 par. 4 of the contract stipulates the following:
“During the contractual period, if Party A had failed to pay Party B for a period of more
than two continuous months, Party b shall have the right to unilaterally terminate the on
alienated contract with immediate effect. Party A shall pay Party B the all the salaries
overdue remaining salary and signing fee and bonuses due under the contract in a lump
sum within 30 days of such termination”.
5. Art. 12 of the contract stipulates the following:
“During the contractual period, if Party B cancel or terminate the contract by himself
without the permission of Party A, Party B shall pay Party A USD 1,000,000 compensation”.
6. On 11 July 2020, the player sent a letter to the club via his legal representative, demanding
that the club pays overdue salaries from January to June 2020.
7. On 13 July 2020, the club replied to the player’s letter dated 11 July 2020 and stated that
it would proceed to a partial payment of the player’s overdue salaries.
8. On 16 July 2020, the club paid the player one month of salary.
9. On 22 July 2020, the player sent another default notice, requesting the payment of his
salaries of February to June 2020 totalling USD 250,000 within the next fifteen days.
10. On 8 August 2020 the player unilaterally terminated the contract invoking art. 14bis of the
Regulations on the Status and Transfer of Players.
II. PROCEEDINGS BEFORE FIFA
11. On 26 August 2020, the Claimant filed a claim for outstanding remuneration and
compensation for breach of contract against the Respondent before FIFA.
12. A brief summary of the position of the parties is detailed below.
a. The claim of the Claimant
13. According to the Claimant, although the Respondent paid his salary for July and August
2019, it refrained from paying the month of September 2019 onwards, for the rest of the
2019 calendar year.
14. After the conclusion of the 2019 season, the player travelled back home and sent multiple
messages to the club asking for the payment of his outstanding remuneration.
15. Despite the non-payment of his remuneration, the player re-joined the club in December
2019 for the pre-season training.
16. On 22 January 2019, the club paid the four outstanding salaries of 2019.
17. On 31 January 2020, in light of the Covid-19 pandemic, the Respondent sent all foreign
players home. The Claimant, therefore, left China and awaited further instructions from the
Respondent.
18. During this period, the Respondent again failed to timely pay the Claimant’s salary. As the
months went by the player repeatedly asked the club about the status of the pending
payments via text messaging, and the club’s representative continued to provide unclear
answers, even suggesting that overdue salaries would only be paid once the pandemic
concluded.
19. After the Claimant sent the default notice dated 11 July 2020, the club paid only one month
of salary.
20. Therefore, the player sent the second default notice dated 22 July 2020.
21. Since the Respondent failed to pay the outstanding remuneration within the deadline of
fifteen days granted by the Claimant in his letter dated 22 July 2020, the latter terminated
the contract on 8 August 2020 invoking just cause.
22. In this regard, the Claimant deems that he had just cause to terminate the contract in
accordance with art. 14bis of the Regulations on the Status and Transfer of Players.
23. The requests for relief of the Claimant were the following:
USD 249,995 corresponding to the salaries of February, March, April, May and
June 2020,
USD 624,987.50 “corresponding 12 1/2 monthly payments covering the residual
value of the contract from 1 July 2020 to 14 July 2021”,
CNY 60,000 corresponding to six months of unpaid rental allowance for the
months of February, March, April, May, June and July 2020,
CNY 12,000.00 corresponding to six months of unpaid transport allowance for
the months of February, March, April, May, June and July 2020,
8 sets of international one-way economy class air tickets between South
America and Beijing, (the player used 5 of the agreed 13 sets of tickets),
which can be conservatively valued at a total of USD 12,000,
Sporting sanctions on the club.
24. As to the calculation of compensation for breach of contract, the player stated that,
assuming the DRC would not apply the compensation clause provided for in art. 11 par. 4
of the contract, the player shall receive in any case the residual value, taking into account
the applicability of art. 17 par. 1 i., since the player remained unemployed following the
termination of the contract (up until the filing of the claim).
25. Should mitigation be applied, the player refers to art. 17 par.1 ii. and deems that, on top
of the mitigated compensation, he should be awarded additional compensation equalling
six months of salary (or subsidiarily 3 months) in light of the termination being linked to
overdue payables and of the egregious circumstances of the case.
b. Position of the Respondent
26. The Respondent failed to submit an answer to the claim by providing its position in a duly
signed document in PDF format. Instead, the Respondent filed a reply in a short e-mail.
27. In said email, the Respondent made the following statement:
“According to the policies concerning the pay cut during the COVID-19 Pandemic of the
FIFA and the Chinese Football Association, the Beijing BSU Football Club is negotiating with
the player Anangono to cut his pay and terminate his contract. If an agreement is reached
on the above matter, we will give feedback to you as soon as possible. If no agreement is
reached, please continue to perform your corresponding procedures. Thank you!”
c. Claimant’s contractual situation following the unilateral termination of the
contract
28. The Claimant concluded a new employment contract with the Paraguayan club, Club River
Plate, valid as from 30 September 2020 until 21 December 2021.
29. According to said contract, the Claimant was entitled to a remuneration of USD 10,000 per
month.
30. On 25 January 2021, the Claimant and the Paraguayan club agreed to terminate the
employment contract.
III. CONSIDERATIONS OF THE DISPUTE RESOLUTION CHAMBER
a. Competence and applicable legal framework
31. 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 26 August 2020 and submitted
for decision on 28 January 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 November 2019
edition of the Procedural Rules is applicable to the matter at hand.
32. 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 August 2020), the
Dispute Resolution Chamber is competent to deal with the matter at stake, which concerns
an employment-related dispute with an international dimension between an Ecuadorian
player and a Chinese club.
33. 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 26 August 2020, the August 2020 edition
of said regulations (hereinafter: the Regulations) is applicable to the matter at hand as to
the substance.
b. Burden of proof
34. 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.
35. 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
36. 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
37. The foregoing having been established, the Chamber moved to the substance of the matter.
First of all, with reference to art. 9 par. 2 of the Procedural Rules, the Chamber took note
of the fact that the Respondent did not file its reply to the claim in PDF format but rather
submitted a statement by e-mail. Consequently, the Chamber concurred that such position
does not have any legal effect. It follows that the Claimant’s allegations remained
uncontested.
38. The Chamber, therefore, deemed that, considering the Claimant’s claim, the main issue at
stake was to determine whether the Claimant had terminated the contract between the
parties with just cause in accordance with art. 14bis of the Regulations.
39. The Chamber recalled that, in accordance with art. 14bis of the Regulations, in the case of
a club unlawfully failing to pay a player at least two monthly salaries on their due dates, the
player will be deemed to have a just cause to terminate his contract, provided that he has put the debtor club in default in writing and has granted a deadline of at least 15 days for
the debtor club to fully comply with its financial obligation(s).
40. Applying the aforementioned principles to the matter at hand, it remained uncontested
that the player terminated the contract on 8 August 2020 after having put the club in
default of payment of his salaries of February to June 2020 on 22 July 2020 and granting
the club fifteen days to remedy the default. Consequently, the DRC found that, at the time
of termination of the contract, the club had indeed failed to pay more than two monthly
salaries to the player. Furthermore, with its default notice dated 22 July 2020, the player
had duly put the club in default and granted the latter fifteen days to remedy such default.
Having received no further payments from the club within the granted deadline, the player
terminated the contract on 8 August 2020.
41. The aforementioned considerations led the Chamber to determine that the Claimant had
terminated the contract between the parties with just cause and in accordance with art.
14bis of the Regulations. Furthermore, the Respondent, which did not contest any of the
Claimant’s allegations, did not provide any valid reason for the non-payment of the player’s
outstanding remuneration.
42. In conclusion, the Respondent shall be held liable for the early termination of the contract.
43. At this point, the Chamber reverted to the Claimant’s claim regarding outstanding
remuneration. The Claimant claimed that the Respondent had not paid him the salaries of
February, March, April, May and June 2020 in the total amount of USD 249,995 as well as the
rental allowance in the total amount of CNY 60,000.
44. Furthermore, the Claimant claims USD 12,000 as transport allowance as well as 8 sets of
international one-way economy class air tickets between South America and Beijing,
(the player used 5 of the agreed 13 sets of tickets), which can be conservatively
valued at a total of USD 12,000.
45. With respect to the salaries, the Chamber established that, in fact, the month of July 2020,
which the Claimant claims as compensation for breach of contract, was also outstanding at the
time of the unilateral termination of the contract on 8 August 2020.
46. In view of the above, and whilst reiterating that the Respondent had not provided any valid
reason for the non-payment of the aforementioned salaries, the Chamber determined that,
in accordance with the legal principle of pacta sunt servanda, the Respondent must pay the
Claimant the total outstanding remuneration equalling USD 299,998.98.
47. Equally, the Claimant is entitled to six monthly rental allowances in the total of CNY 60,000.
48. Furthermore, and in light of the Claimant’s respective claim as well as the constant practice
of this Chamber, 5% p.a. will apply on these amounts as from the day following the due
dates for each individual month until the date of effective payment.
49. As to the transport allowance, the DRC noted that, according to the contract, transport
costs would be covered he costs were to be covered for transportation
“within Beijing”. Since, upon his own admission, the Claimant left China on 31 January
2020 and never returned, it would be inappropriate to grant him the claimed transport
allowance. The Chamber thus rejected this request for relief.
50. Finally, and as to the Claimant’s claim regarding flight tickets, the DRC also decided to reject
such claim due to a lack of documentary evidence as to the actual costs incurred by the
player in connection with the purchase of flight tickets.
51. Moving on to the Claimant’s request for compensation for breach of contract, the Chamber
reiterated that the Respondent is to be held liable for the early termination of the
employment contract without just cause. Taking into consideration art. 17 par. 1 of the
Regulations, the Chamber decided that the Claimant is entitled to receive an amount of
money from the Respondent as compensation for the termination of the contract with just
cause.
52. 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 Claimant 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.
53. In application of the relevant provision, the Chamber held that it first of all had to clarify as to
whether the pertinent employment contract contains 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 established that art. 11 par. 4 of
the contract constitutes a compensation clause and that the parties had agreed upon the
following:
“During the contractual period, if Party A [the club] had failed to pay Party B [the player] for
a period of more than two continuous months, Party B shall have the right to unilaterally
terminate the on alienated contract with immediate effect. Party A shall pay Party B the all
the salaries overdue remaining salary and signing fee and bonuses due under the contract
in a lump sum within 30 days of such termination”.
54. In this regard, the Chamber deemed that such clause finds application in the present matter.
Indeed, it is established that the Claimant terminated the contract due to the Respondent’s
failure to pay his remuneration for more than two continuous months. Furthermore, the
clause in question grants the Claimant compensation in the amount corresponding to the
residual value of the contract, from the date of termination until its original expiry (plus the
signing-on fee and bonuses). The Chamber held that such clause is fair, reasonable and
proportionate.
55. As a consequence and considering the Claimant’s claim for compensation for breach of
contract, together with the wording of art. 11 par. 4 of the contract, the Chamber decided
that the Respondent shall pay compensation corresponding to the value of the Claimant’s
salaries from August 2020, month in which the Claimant terminated the contract, until 14
July 2021, i.e. 11.5 months. For the sake of clarity, the Chamber emphasised that,
considering the parties had agreed upon the compensation beforehand, no mitigation of
the compensation shall be applied.
56. In conclusion, the Respondent is liable to pay the Claimant compensation for breach of
contract in the amount of USD 574,998.04. Furthermore, considering the Claimant’s
respective claim as well as the constant practice of this Chamber, 5% interest p.a. shall
apply on the said amount as from 26 August 2020, i.e. the date of the claim, until the date
of effective payment.
ii. Compliance with monetary decisions
57. Finally, taking into account the consideration under number 33. 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.
58. 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.
59. Therefore, bearing in mind the above, the DRC decided that, in the event that the
Respondent does not pay the amounts due to the Claimant within 45 days as from the
moment in which the Claimant, communicates the relevant bank details to the Respondent,
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 Respondent in accordance
with art. 24bis par. 2 and 4 of the Regulations.
60. 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.
61. Lastly, the DRC concluded its deliberations by rejecting any other requests for relief made
by any of the parties.
IV. DECISION OF THE DISPUTE RESOLUTION CHAMBER
1. The claim of the Claimant, Juan Luis Anangonó León, is partially accepted.
2. The Respondent, Beijing BSU FC, has to pay to the Claimant the following amounts:
USD 299,998.98 and CNY 60,000 as outstanding remuneration plus 5% interest
p.a. as follows:
5% interest p.a. on USD 49,999.83 as from 1 March 2020 until effective payment,
5% interest p.a. on USD 49,999.83 as from 1 April 2020 until effective payment,
5% interest p.a. on USD 49,999.83 as from 1 May 2020 until effective payment,
5% interest p.a. on USD 49,999.83 as from 1 June 2020 until effective payment,
5% interest p.a. on USD 49,999.83 as from 1 July 2020 until effective payment,
5% interest p.a. on USD 49,999.83 as from 1 August 2020 until effective payment,
5% interest p.a. on CNY 10,000 as from 1 February 2020 until effective payment,
5% interest p.a. on CNY 10,000 as from 1 March 2020 until effective payment,
5% interest p.a. on CNY 10,000 as from 1 April 2020 until effective payment,
5% interest p.a. on CNY 10,000 as from 1 May 2020 until effective payment,
5% interest p.a. on CNY 10,000 as from 1 June 2020 until effective payment,
5% interest p.a. on CNY 10,000 as from 1 July 2020 until effective payment.
USD 574,998.04 as compensation for breach of contract plus 5% interest p.a. as
from 26 August 2020 until effective payment.
3. Any further claims of the Claimant are 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).
CONTACT INFORMATION:
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