F.I.F.A. – Commissione per lo Status dei Calciatori (2013-2014) – controversie tra società – ———- F.I.F.A. – Players’ Status Committee (2013-2014) – club vs. club disputes – official version by www.fifa.com – Decision of the Single Judge of the Players’ Status Committee passed in Zurich, Switzerland, on 29 July 2013, by Geoff Thompson (England) Single Judge of the Players’ Status Committee, on the claim presented by the club, Club Z, from country S as Claimant against the club, Club B, from country G as Respondent regarding a contractual dispute between the parties relating to the player S

F.I.F.A. - Commissione per lo Status dei Calciatori (2013-2014) – controversie tra società – ---------- F.I.F.A. - Players' Status Committee (2013-2014) – club vs. club disputes – official version by www.fifa.com – Decision of the Single Judge of the Players’ Status Committee passed in Zurich, Switzerland, on 29 July 2013, by Geoff Thompson (England) Single Judge of the Players’ Status Committee, on the claim presented by the club, Club Z, from country S as Claimant against the club, Club B, from country G as Respondent regarding a contractual dispute between the parties relating to the player S I. Facts of the case 1. On 1 July 2007, Club Z, from country S (hereinafter: the Claimant) and Club B, from country G (hereinafter: the Respondent) concluded a transfer agreement (hereinafter: the agreement) for the transfer of the player S (hereinafter: the player) from the Claimant to the Respondent for an amount of EUR 750,000. 2. The agreement provided the following handwritten clauses: “Im Falle des Abstiegs des Club B in die 2. Liga und des nicht sofortigen Aufstiegs im darauffolgenden Jahr, hat Club Z das Vorkaufsrecht an dem Spieler S für 1.000.000.- Euro. Das Vorkaufsrecht muss bis zum 15. Juni des betroffenen Jahres ausgeübt werden. Im Falle des Weiterverkaufs des Spielers S durch den Club B erhält Club Z 15% der Ablösesumme, abzüglich der vom Club B an Club Z geleisteten Zahlungen.“ (NB: English translation): “In case of a relegation of Club B to the 2nd Bundesliga and in case that Club B will not be immediately promoted to 1st Bundesliga the year following, Club Z has a first option to purchase the player S back for the transfer compensation in the sum of 1.000.000,- EUR. Such option has to be executed by 15 June of the relevant year. In case of the subsequent sale of the player by Club B Club Z shall receive 15% from the transfer compensation, lowered by the payments already paid by Club B to Club Z.” 3. On 7 June 2007, the Respondent and the player signed an employment contract valid as from 1 July 2007 until 30 June 2011 (hereinafter: first contract), which, on 6 November 2009, was extended until 30 June 2013 (hereinafter: second contract) and was allegedly again extended on 4 August 2010 until 30 June 2014. 4. On 6 August 2010, the Respondent loaned the player to the Club B, from country T (hereinafter: Club M), for the transfer amount of EUR 600,000. The loan agreement contained a purchase option in favour of Club M which had to be exercised until 20 May 2011, stipulating an anticipated transfer compensation of EUR 3,125,000. 5. On 13 October 2010, the Claimant informed the Respondent in writing that, should the Respondent not make it back to the 1st Bundesliga at the end of the season, it would exercise its purchase option according to the agreement (cf. point I.2). On 1 June 2011 and 15 June 2011, the Claimant reiterated its will to exercise the abovementioned right via regular mail. 6. On 24 May 2011, the Respondent and Club M signed an agreement for the definitive transfer of the player for the amount of EUR 2,150,000 with effect as of 1 July 2011. 7. In the same agreement, the parties agreed upon a settlement fee of EUR 750,000 in order to settle their dispute regarding the non-payment of the loan fee. Thereof, the amount of EUR 525,000 was payable until 15 June 2011 and the amount of EUR 225,000 until 30 September 2011. 8. On 20 September 2011, the Claimant lodged a claim at FIFA against the Respondent, claiming the amount of EUR 2,800,000 plus 5% interest p.a. as of 1 July 2011 as follows: • 15% from the transfer compensation agreed between Club M and the Respondent lowered by EUR 750,000 paid as transfer compensation by the Respondent to the Claimant = EUR 3,800,000 – EUR 750,000 /100 x15 = EUR 457,500. • Accrued damages resulting from refusing the right of the first purchase option = EUR 3,800,000 (market value of the player) – EUR 457,500 (15% compensation) – EUR 1,000,000 (sum to be paid for the transfer of the Player) = EUR 2,342,500. 9. In support of its claim, the Claimant provided a statement from its legal representative dated 7 September 2011, according to which “it was clear between the contracting parties that Club Z has a right to buy the player back in case the conditions stated above are met as long as the player is in Club B and a right to receive 15% from possible subsequent transfer. (…) It was clear that conditions set in the transfer agreement are valid as long as the player is registered player of Club B”. 10. In its reply, the Respondent rejected the Claimant’s claim stating that the rights stipulated in the handwritten clause of the agreement could not be exercised by the Claimant anymore, as they were only granted for the time the player was actually bound by the first employment contract. The Claimant’s legal position was not supposed to be improved by the employment contract extension of the second contract. 11. Furthermore, the Respondent indicates that, by requesting 15% of the transfer compensation in connection with the subsequent transfer of the player as well as damages for the alleged loss of the purchase option, the Claimant is pursuing contradictory claims. The aforementioned rights of the handwritten clause are allegedly exclusive to one another, since the subsequent transfer participation could only be fulfilled in case of a transfer to a third club, whereas the purchase option could then not be exercised. Vice versa, in case the Claimant should exercise its purchase option, there would be no more room for a transfer participation. 12. Therefore, the Respondent holds that the right for a subsequent transfer participation must have priority over the purchase option. If not, the Respondent would have never had the possibility to transfer the player to another club without being in breach of its contractual obligations. In addition to that, such situation would allegedly give the Claimant “power over the player” during the term of a contract between the player and the Respondent, which would constitute a violation of art 18bis par. 1 of the Regulations of the Status and Transfer of Players (hereinafter: the Regulations). 13. Also, the purchase option was allegedly only included in the agreement to protect the market value of the player, as it should be avoided that he would play in the 2nd Bundesliga only. Since he actually played in the 1st country T league after being loaned and transferred by the Respondent to Club Z, this was not the case. 14. Moreover, even if the purchase option would have had priority over the participation clause, the Claimant would not have had the right to exercise this option, as the respective purchase option was only based on the first employment contract. The loan and transfer of the player to Club Z was based on the second employment contract with a higher salary and better conditions for the player, which would have made the purchase option much more expensive for the Claimant. 15. Additionally, the aforementioned rights of the handwritten clause were allegedly only valid as long as the player was a registered player of the Respondent, since both rights were directly linked to the terms of the first employment contract between the player and the Respondent. Consequently, the first employment contract concluded between the Respondent and the player and the transfer agreement concluded with the Claimant were dependent on one another. In this context, the Respondent indicated that the first employment contract and the transfer agreement were allegedly negotiated on the same day and that the player was allegedly represented by the club’s legal representative. 16. Moreover, the Claimant was not supposed to benefit from the contractual terms of the second employment contract between the Respondent and the player. After expiry of the first employment contract, the Claimant could not ask for a transfer compensation from Club M as the transfer to Club M was solely based on the second employment contract. Therefore, the Claimant can only exercise its right to participate in the loan agreement compensation until the end of term of the first employment contract for a value of EUR 600,000, which would be 0 [(EUR 600,000 – EUR 750,000) x 15% = 0]. Any other claim, especially the damages of EUR 2,342,500 should be rejected. 17. In its replica, the Claimant maintained its previous arguments and rejected the argument that there is a link between the rights of the handwritten clause of the transfer agreement and the first employment contract only, since there is no such reference in the transfer agreement. The Claimant’s right to exercise its rights from the handwritten clause should be valid as long as the player has a valid employment relationship with the Respondent. The term “registered player of Club B” as used by the legal representative of the Claimant in his statement dated 7 September 2011, should not mean the player’s registration with the respective Association, but that the player is still contractually bound to the Respondent. According to the Claimant, the same should apply as to the intention in the agreement, as the Claimant’s only intention was to have the possibility to eventually get back the player. 18. Furthermore, should any dispute arise regarding the interpretation of the handwritten clause, the principle “in dubio contra stipulatorem” should apply, as the Respondent “had in his power to specifically write down the time limit into the Transfer Agreement in order to avoid any doubts or misinterpretation.” 19. In addition to that, the Claimant rejects the violation of art 18bis par. 1 of the Regulations, as the Respondent at any time was free to transfer the player, except when the conditions of the rights of the handwritten clause were met and the Claimant would exercise this option. In case the Claimant would not exercise its rights, the Respondent was free to transfer the player and the participation clause would have come into effect. 20. In this context, the Claimant states that the Respondent was in breach of the agreement when it transferred the player after the start of the registration period in country T on 14 June 2011, i.e. after the conditions of the Claimant’s purchase option were met and exercised via regular mail on 1 June 2011. 21. In addition to that, the Claimant objects to the Respondent’s argument that the two rights of the handwritten clause stood exclusive to each other, since there is no priority between the two clauses. 22. Finally, the Claimant held that its legal representative was not acting as the legal representative of the player during the negotiation of the first employment contract and that the latter was represented by the player’s agent, who also signed the first employment contract. 23. To that, the Respondent replied that the loan agreement between the Respondent and Club M and the transfer agreement for the definitive transfer of the player to Club M should be regarded as two separate agreements. In this respect, the first purchase option of Club M from the loan agreement between Club M and the Respondent allegedly ended on 20 May 2011, whereas the definitive transfer agreement was signed on 24 May 2011. Therefore, the participation clause should only profit from the first subsequent transfer which is the loan agreement. 24. Finally, the Respondent states that only the amount the Respondent actually received from Club M should be decisive for the calculation of the amount from the participation clause, i.e. the amount of EUR 525,000 which was paid until 20 April 2012. Since Club M allegedly still owes money to the Respondent, this should also affect the payments due to the Claimant. 25. In its final reply, the Claimant states that only the amount that Club M owes to the Respondent should be decisive for the calculation of the 15% participation right, and not the amount actually paid to the Respondent, as the Claimant should not cover the risk of the Respondent’s contract with any third parties. 26. In its final position, the Respondent reiterated its previous position, emphasizing that it was “common practice in international football that in cases of transfer fee participation both parties share the risk of non-payment of the new club.” In support of this argument, the Respondent quoted from the decision CAS 2007/A/XXXX, in which “CAS evaluated such [NB: participation] clauses in such a way that a “realization” of the transfer fee is required for the claim of transfer participation”. Therefore, if such participation clause was still applicable for the second transfer of the player, the Claimant should only profit from it when the Respondent received the transfer compensation from Club M. 27. The Respondent played in the 1st Bundesliga during the seasons 2007/08, 2008/09 and 2009/10, before the Respondent was relegated into the 2nd Bundesliga during the season 2010/11. II. Considerations of the Single Judge of the Players’ Status Committee 1. First of all, the Single Judge of the Players’ Status Committee (hereinafter also referred to as: the Single Judge) analysed whether it was competent to deal with the matter at hand. In this respect, he referred to art. 21 par. 2 and 3 of the Rules Governing the Procedures of the Players’ Status Committee and the Dispute Resolution Chamber (editions 2012 and 2008). Consequently, and since the present matter was submitted to FIFA on 20 September 2011, the Single Judge concluded that the 2008 edition of the Rules Governing the Procedures of the Players’ Status Committee and the Dispute Resolution Chamber (hereinafter: the Procedural Rules) is applicable to the matter at hand. 2. Furthermore, the Single Judge confirmed that, on the basis of art. 3 par. 1 of the Procedural Rules in connection with art. 23 par. 1 and 3 as well as art. 22 f) of the 2012 and 2010 editions of the Regulations on the Status and Transfer of Players, it was competent to deal with the present matter since it concerned a dispute between two clubs affiliated to different associations. 3. Subsequently, the Single Judge analysed which edition of the Regulations on the Status and Transfer of Players should be applicable as to the substance of the matter. In this respect, he referred, on the one hand, to art. 26 par. 1 and 2 of the 2012 and 2010 editions of the Regulations on the Status and Transfer of Players and, on the other hand, to the fact that the claim was lodged with FIFA on 20 September 2011. In view of the foregoing, the Single Judge concluded that the 2010 edition of the FIFA Regulations for the Status and Transfer of Players (hereinafter: the Regulations) is applicable to the case at hand as to the substance. 4. The competence of the Single Judge of the Players’ Status Committee and the applicable regulations having been established and entering into the substance of the matter, the Single Judge started by acknowledging the above-mentioned facts as well as the arguments and the documentation submitted by the parties. 5. In this respect, the Single Judge noted that on 1 July 2007 the parties concluded a transfer agreement for the transfer of the player from the Claimant to the Respondent for an amount of EUR 750,000. 6. In addition, the agreement provided that, in case of a relegation of the Respondent to the 2nd Bundesliga and in case that the Respondent would not be immediately promoted to 1st Bundesliga the year following, the Claimant was granted a first option to purchase the player back for a fixed transfer compensation for an amount of EUR 1,000,000. Such option (hereinafter: purchase option) had to be executed by 15 June of the relevant year. Furthermore, the agreement also stipulated that, in case of the subsequent sale of the player by the Respondent, the Claimant should receive 15% from the transfer compensation, lowered by the payments already paid by the Respondent to the Claimant (hereinafter: sell-on-clause). 7. In continuation, the Single Judge recalled that the Claimant requested the amount of 2,800,000 plus interest composed, on the one hand, of 15% from the transfer compensation agreed between Club M and the Respondent, lowered by EUR 750,000 paid as transfer compensation by the Respondent to the Claimant, and on the other hand, of accrued damages resulting from the fact that the Respondent denied its right to exercise the purchase option. In this respect, the Single Judge acknowledged that the Claimant held that the purchase option, respectively the sell-on clause, did not stand exclusive to one another and that no clause had priority over the other, i.e. that it was entitled to receive the stipulated percentage from the sell-on-clause, even after having exercised the purchase option. 8. The Single Judge further noted that the Respondent had rejected the Claimant’s claim entirely, alleging in essence that the purchase option and the sell-on clause were indeed exclusive to one another, and that both these clauses were only applicable as long as the first employment contract was valid. The Single Judge also acknowledged the Respondent’s arguments that the sell-on-clause should have priority over the purchase option, as it would allegedly have otherwise never been possible for the Respondent to transfer the player to a third club without being in conflict with the Claimant’s purchase option, i.e. without being in breach of the agreement. 9. Having taken note of the main arguments of the parties, the Single Judge reasoned that the underlying issue in the present matter was to determine the scope of the purchase option and of the sell-on-clause as provided in the agreement concluded between the parties. 10. In this regard, and after thorough analysis of the relevant clauses, the Single Judge pointed out that the purchase option and the sell-on-clause had to be regarded as being exclusive to one another as it was not possible to trigger both rights at the same time. In view of this, the Single Judge explained that, had the Claimant intended to exercise the purchase option, the sell-on-clause would no longer be applicable since the player would have effectively been transferred back to the Claimant. Equally, in case the Claimant wanted to exercise the sell-on- clause, there would be no more room for an application of the purchase option as this would contradict the intent of the sell-on-clause. 11. Consequently, the Single Judge raised the question which one of the two ancillary rights should be considered in the assessment of the present matter. In this regard, the Single Judge pointed out that the Claimant had in fact exercised the purchase option on 13 October 2010 under the condition that the Claimant would not advance to the country G “1. Bundesliga”, and that it reiterated its wish to purchase the player back on 1 June 2011 and on 15 June 2011. However, the Single Judge equally underlined that, in the context of the present claim, the Claimant was also pursuing the payment of the amount due in accordance with the sell-on clause, in view of the fact that, in the meantime, the player was transferred to the country T club B. 12. As a consequence of the above, and given the contents of the Claimant’s claim, the Single Judge concluded that the Claimant had de facto renounced to the reacquisition of the player’s services. In any case, the Single Judge wished to emphasize that the potential reacquisition of the player’s services would have required the latter’s consent. Since the player, however, was subsequently loaned and definitively transferred to Club M, it is obvious that he did not express any intention to return to the Claimant. 13. In the light of this, it appeared to the Single Judge that the remaining question was to decide whether the Claimant is indeed entitled to any amounts under the sell-on clause, and if so, what would be the exact amount due to the Claimant. 14. In this regard, the Single Judge, on the one hand, acknowledged the Respondent’s arguments, according to which the sell-on-clause should only be based on the first transfer of the player, i.e. on the loan of the player from the Respondent to the Claimant for an amount of EUR 600,000. Therefore, as 15% of this amount, lowered by the amount of EUR 750,000 which was paid to the Claimant pursuant to the transfer of the player from the Claimant to the Respondent, amounted to zero, no amounts should be payable. In addition to that, the the Respondent held that the Claimant’s right to claim amounts based on the sell-on-clause should only be valid as long as the player was actually bound by the first employment contract as the Claimant’s legal position was not supposed to be improved by the extension of the above-mentioned employment contracts. 15. In continuation, the Single Judge took note that the Claimant, on the other hand, is of the opinion that this clause should apply only to the definitive transfer of the player whereas the Respondent held that it should also apply to the loan of the player. 16. On account of the above, the Single Judge analysed the wording of the handwritten clause stipulating the sell-on-clause and especially drew his attention to the term “im Falle des Weiterverkaufs des Spielers” (NB, English translation: “in case of the resale of the player”). In this sense, the Single Judge took the view that the term “sale” could only be translated into a definitive transfer; the loan of a player, on the contrary, lacks such definitive element and does consequently not qualify as a “sale”. 17. Consequently, the Single Judge held that only the amount of the subsequent definitive transfer of the player should be covered by said clause, whereas the transfer compensation of the loan of the player should be excluded from the application of the sell-on-clause. 18. Furthermore, the Single Judge could not agree with the submission of the Respondent which indicated that the sell-on-clause would only be exercisable during the validity of the first employment contract. Indeed, the agreement does not indicate such restrictive condition. 19. Therefore, the Single Judge concluded that the sell-on-clause is applicable to the subsequent transfer of the player to Club M, even though the Respondent and the player concluded two more employment contracts in the meantime. 20. Consequently, the Single Judge concluded that the Respondent is liable to pay the amounts due to the Claimant as per the sell-on clause, and that the amount payable by the Respondent to the Claimant in this context should be based on the transfer agreement which was concluded between the Respondent and Club M on 24 May 2011. 21. As to the calculation of the said amount, the Single Judge took into account the amount of the transfer compensation as stipulated in the relevant transfer agreement, i.e. EUR 2,150,000, to be lowered by the amount of EUR 750,000 which was paid by the Respondent to the Claimant for the transfer of the player from the Claimant to the Respondent, offset with the percentage of 15% as stipulated in the sell-on-clause. Therefore, the Single Judge decided that the amount which has to be paid by the Respondent to the Claimant in accordance with the sell-on clause as per the agreement amounts to EUR 210,000. 22. Finally and for the sake of completeness, the Single Judge acknowledged the Respondent’s argument that the sell-on-clause could only be based on the transfer amounts it actually received from Club M. In this regard, the Single Judge reasoned that, assuming this would be the case, such failure on the part of Club M could only be held against the latter club itself but not against the Claimant. It would then be up to the Respondent to turn itself against Club M to preserve its rights in this regard. 23. Finally, the Single Judge acknowledged that the Claimant is also requesting accrued damages for an amount of EUR 2,342,500, resulting from the Respondent’s alleged refusal to grant the Claimants its right to exercise the purchase option. However, the Single Judge found no legal or contractual basis for concluding that such amount would be payable, nor that the Claimant had provided any proof for its claim as stipulated in art. 12 par. 3 of the Procedural Rules, especially with regards to the question whether the Claimant had actually suffered from such damage. 24. In view of all of the above, the Single Judge concluded that the claim of the Claimant is partially accepted and consequently, the Respondent has to pay to the Claimant the amount of EUR 210,000 representing 15% of the difference between the transfer amount of EUR 2,150,000, which was paid by the Respondent to Club M for the definitive transfer of the player, and the amount of EUR 750,000 which was paid by the Respondent to the Claimant. In addition to that, the Single Judge decided that and in view of the Claimant’s respective claim, the Respondent has to pay interest at a rate of 5% p.a. on said amount as of 2 July 2011. 25. Finally, the Single Judge referred to art. 25 par. 2 of the Regulations in combination with art. 18 par. 1 of the Procedural Rules, according to which, in the proceedings before the Players’ Status Committee, costs in the maximum amount of currency of country H 25,000 are levied. The relevant provision further states that the costs are to be borne in consideration of the parties’ degree of success in the proceedings (cf. art. 18 par. 1 of the Procedural Rules) and are usually borne by the losing party. 26. Furthermore and according to Annexe A of the Procedural Rules, the costs of the proceedings are to be levied on the basis of the amount in dispute. The amount in dispute to be taken into consideration in the present proceedings is EUR 2,800,000. Therefore, the Single Judge concluded that the maximum amount of costs of the proceedings corresponds to currency of country H 25,000. 27. Considering the difficulty of the case as well as the numerous correspondences exchanged between the parties during the procedure and taking into account that the present decision was taken by the Single Judge and not by the Players’ Status Committee, the members of the Single Judge determined the costs of the current proceedings to the amount of currency of country H 20,000. 28. Furthermore, the Single Judged recalled that the costs are to be borne in consideration of the parties’ degree of success in the proceedings (cf. art. 18 par. 1 of the Procedural Rules) as well as that the claim is only partially accepted, the amount of currency of country H 15,000 has to be paid by the Respondent and the amount of currency of country H 5,000 has to be paid by the Claimant in order to cover the costs of the present proceedings. Given that the Claimant paid the amount of currency of country H 5,000 as advance of costs at the start of the present proceedings, no additional amount has to be paid by the Claimant. III. Decision of the Single Judge of the Players’ Status Committee 1. The claim of the Claimant, Club Z , is partially accepted. 2. The Respondent, Club B, has to pay to the Claimant, Club Z, within 30 days as from the date of notification of this decision, the amount of EUR 210,000 plus 5% interest p.a. on said amount as of 2 July 2011 until the date of effective payment. 3. If the aforementioned sum plus interest is not paid within the aforementioned deadline, the present matter shall be submitted, upon request, to FIFA’s Disciplinary Committee, for consideration and a formal decision. 4. Any further claim lodged by the Claimant, Club Z, is rejected. 5. The final costs of the proceedings in the amount of currency of country H 20,000 are to be paid within 30 days as from the notification of the present decision as follows: 5.1 The Respondent, Club B, has to pay the amount of currency of country H 15,000 to FIFA to the following bank account with reference to case nr.: 5.2 The Claimant, Club Z, has to pay the amount of currency of country H 5,000 to FIFA. Given that the Claimant has already paid the amount of currency of country M 5,000 as advance of costs at the start of the present proceedings, no additional amount has to be paid by the Claimant. 6. The Claimant, Club Z, is directed to inform the Respondent, Club B, immediately and directly of the account number to which the remittance under point 2 is to be made and to notify the Single Judge of the Players’ Status Committee of every payment received. ***** Note relating to the motivated decision (legal remedy): According to art. 67 par. 1 of the FIFA Statutes, this decision may be appealed against before the Court of Arbitration for Sport (CAS). The statement of appeal must be sent to the CAS directly within 21 days of receipt of notification of this decision and shall contain all the elements in accordance with point 2 of the directives issued by the CAS, a copy of which we enclose hereto. Within another 10 days following the expiry of the time limit for filing the statement of appeal, the appellant shall file a brief stating the facts and legal arguments giving rise to the appeal with the CAS (cf. point 4 of the directives). The full address and contact numbers of the CAS are the following: Court of Arbitration for Sport Avenue de Beaumont 2 1012 Lausanne Switzerland Tel: +41 21 613 50 00 Fax: +41 21 613 50 01 e-mail: info@tas-cas.org www.tas-cas.org For the Single Judge of the Players’ Status Committee Jérôme Valcke Secretary General Encl. CAS Directives