F.I.F.A. – Players’ Status Committee / Commissione per lo Status dei Calciatori – club vs club disputes / controversie tra società – (2016-2017) – fifa.com – atto non ufficiale – Decision 22 November 2016

Decision of the

Single Judge

of the

Players’ Status Committee

passed in Zurich, Switzerland, on 22 November 2016,

by

Geoff Thompson (England)

Single Judge of the Players’ Status Committee,

on the claim presented by the club,

Club A, from country C

as Claimant

against the club,

Club B, from country I

as Respondent

regarding a contractual dispute between the parties

relating to the player F

Player F, from country F

I. Facts of the case

1. On 1 August 2015, the Club A, from country C (hereinafter: Claimant), and Club B, from country I (hereinafter: Respondent), concluded a transfer agreement for the transfer of the C player F, from country F (hereinafter: the player), from the Claimant to the Respondent.

2. Clause 4 of the transfer agreement stipulated that, for the transfer of the player, the Respondent had to pay to the Claimant the amount of EUR 1,000,000, in two equal instalments, as follows:

- EUR 500,000 within 15 days following the receipt of the ITC; and

- EUR 500,000 by no later than 31 January 2016.

Equally, the parties agreed upon the following conditional transfer fee:

- EUR 200,000 in case the player plays 10 matches of at least 45 minutes with the first team of the Respondent in Serie A;

- EUR 200,000 in case the player plays 20 matches of at least 45 minutes with the first team of the Respondent in Serie A; and

- EUR 200,000 in case the player plays 1 match of at least 45 minutes with the first team of the Respondent in UEFA Champions League or UEFA Europa League.

Furthermore, the aforementioned clubs further agreed upon a sell-on clause of 40% of any and all amounts to be received by the Respondent above EUR 1,000,000 and any bonus occurred relating to the player.

3. Clause 6 of the transfer agreement provided the following:

“Suspending condition

The agreement is conditioned to the release by Football Federation of country I of the registration as professional player of the Player”.

4. On the same day, the Claimant and the player concluded a termination agreement, according to which “both parties agree that pursuant to the present termination of the [employment] agreement, the player is free to negotiate his employment with any other club in country C and/or abroad”.

5. On 18 January 2016, the Claimant lodged a claim before FIFA against the Respondent requesting EUR 1,600,000, i.e. EUR 1,000,000 as the alleged outstanding transfer fee and EUR 600,000 as the conditional transfer fee, as well as that the Respondent be ordered to cover all the costs of the proceedings and “the legal fees of the Player in regards to this procedure, as per the latest DRC jurisprudence that has allocated legal costs in favour of the winning side of a procedure”.

Player F, from country F

6. In particular, the Claimant held that in spite of being dated 1 August 2015, the parties agreed upon the transfer of the player on 20 February 2015 and that the transfer agreement was eventually signed on 25 February 2015. In this respect, the Claimant provided a copy of an exchange of emails between the alleged player’s representative, the Respondent and the Claimant dated 20 February 2015, according to which, the parties remitted via email the signed transfer agreement. In this context, the Claimant further provided a copy of a letter dated 19 May 2015, by means of which the Respondent undertook to pay to the Claimant the total amount of EUR 540,000 within 15 days following the receipt of the ITC, i.e. EUR 500,000 as the first instalment of the transfer fee and EUR 40,000 as reimbursement of the players’ monthly salaries of February 2015, March 2015, April 2015 and May 2015. Furthermore, the Claimant provided a copy of a letter it remitted to the Respondent authorising the player to train with said club as of 19 May 2015.

7. Moreover, the Claimant held that the Respondent prevented the player from training during the period between 2 July 2015 and 11 August 2015, i.e. the date in which he allegedly decided to leave the Respondent. In this respect, the Claimant provided a copy of two emails dated 11 and 22 August 2015 respectively sent by the player to the Respondent, by means of which he complained, amongst others, about the way he had been treated, that he could neither train nor play and that he had not been paid.

8. In this context, the Claimant pointed out that it had validly concluded a transfer agreement with the Respondent for the player in February 2015 and that the player was at the latter’s disposal since May 2015 but that, due to the limitations applying to the registration of non-European Union players, the Respondent could not register him despite having had 5 months to study the player’s citizenship issue.

9. In this regard, the Claimant stated that it introduced the relevant instruction in the TMS on 1 August 2015 and that the Respondent failed to do so, resulting in TMS Compliance contacting the Respondent for the “failure to enter counter-instruction in TMS within reasonable time”.

10. In light of the foregoing, the Claimant stated that the Respondent was in breach of the transfer agreement as well as of the general principle of pacta sunt servanda as the transfer fee remains allegedly outstanding.

11. In this respect, the Claimant referred to the jurisprudence of the FIFA Players’ Status Committee (PSC) and the Court of Arbitration for Sport (CAS) and held that the present situation cannot be considered force majeure as the event which leads to the non-performance of the transfer agreement was not outside the control of the parties and could have been avoided by the exercise of due diligence. Equally, the Claimant was of the opinion that the Respondent’s argument that it could not register the player due to his

Player F, from country F nationality did not affect the validity of the transfer agreement validly concluded and held that nothing in the transfer agreement could lead to the conclusion that the parties subjected its validity to the registration of the player due to his condition of non-EU citizen.

12. In this regard, the Claimant referred to art. 17 of the FIFA Regulations on the Status and Transfer of Players, according to which a party that breaches a contract without just cause is obliged to pay compensation to the affected party based on the law of the country, the specificity of sport and any other objective criteria. In particular, the Claimant held that the aforementioned provision is applicable to contracts concluded between players and clubs and stated that, in its opinion, it could be analogously applied to the present matter.

13. As to the consequences of the Respondent’s alleged breach of the transfer agreement, the Claimant provided an unsigned copy of the 2014/2015 Football Federations I’s employment contract standard template allegedly entered into by the player and the Respondent for the period between 1 July 2015 and 30 June 2019, i.e. for 4 sporting seasons. Consequently, the Claimant held that the conditions triggering the payment of the conditional transfer fee were reachable in said time frame and that, as a result, it should be assumed that the conditions were fulfilled and that the Respondent would have to pay to the Claimant the amount of EUR 600,000 on top of the fixed transfer fee of EUR 1,000,000.

14. Furthermore, regarding the sell-on clause, the Claimant stated that, although it is not possible to know what would be the 40% of the amount that the Respondent would have received for the potential subsequent transfer of the player to a hypothetical third club, reduced by the amount paid by the Respondent to the Claimant, the sell-on clause has to be taken into account when determining the compensation payable by the Respondent.

15. Lastly, the Claimant provided a copy of the Respondent’s email dated 13 August 2015, by means of which the latter proposed to solve the present matter by i) definitively transferring the player to Club O, from country X and subsequently transfer him on loan to the club, Club M, from country Y and, ii) rescheduling the payment of the transfer fee. In this respect, the Claimant provided a copy of its email dated 14 August 2015, by means of which it rejected the Respondent’s offer and proposed a new payment plan.

16. In its reply, the Respondent rejected the Claimant’s claim by stating that it did not breach the transfer agreement and by referring to clause 6 of the transfer agreement. In this respect, the Respondent held that it never entered into an employment contract with the player and that, as a result, the transfer agreement never became binding and enforceable between the parties. In particular, the Respondent asserted that clause 6 of the transfer agreement referred to the regulatory framework of the Football Federation of country I “that made it difficult (if not impossible) for [the Respondent] to register a non-EU player”.

Player F, from country F

17. Furthermore, the Respondent stated that the transfer of the player was linked to the transfer of Player S, from country F (hereinafter: Players S) to the Respondent and that the fact that the Claimant hid this information results in the latter being in breach of art. 5 par. 2 of the Rules Governing the Procedures of the Players’ Status Committee and the Dispute Resolution Chamber.

18. In this respect, the Respondent held that during the negotiations for the transfer of Playe5r S, the latter requested that the player, who is one of the players of his country F charitable organization, be transferred to the Respondent.

19. At this point, the Respondent stated that it explained that it did not know the player and that there were not non-EU places available to register him. However, in order to conclude Player S’s transfer, the Respondent agreed to do whatever possible to accommodate his requests and initiated the negotiations with the Claimant, to which it allegedly informed of the problems that may arise in connection with the non-European Union citizenship of the player, resulting in the inclusion of the clause 6 in the transfer agreement.

20. In light of the foregoing, when TMS Compliance invited the Respondent to inform of the circumstances of its delay in inserting the counter-instruction for the transfer of the player, it replied that no employment agreement had been concluded with the player and that, consequently, his registration as a professional never occurred, resulting in the transfer agreement not being binding. In this regard, the Respondent provided a mass media report quoting an interview of S’s, according to which, the Respondent never registered the player.

21. Furthermore, the Respondent argued that it undertook to reimburse the player’s salary to the Claimant together with the first instalment of the transfer fee following the release of the ITC and, hence, subject to the registration of the player with the Respondent.

22. Moreover, the Respondent assessed that on the same day the transfer agreement “was executed” between the parties, the Claimant terminated its employment contract with the player. Consequently, the player became a free agent and, hence, the Claimant could no longer transfer him to the Respondent. In the latter’s opinion, this prevents the Claimant from enforcing a transfer agreement that the latter has breached as it did no longer hold the registration rights of the player and, consequently, no compensation shall be payable.

23. In this respect, the Respondent further stated that the compensation for the alleged breach of the transfer agreement based on the conditional transfer fee and the sell-on clause are based on circumstances of a purely speculative nature and shall be rejected.

Player F, from country F

24. In addition, the Respondent rejected that the jurisprudence to which the Claimant referred applies to the case at hand since there were not a clause similar to clause 6 of the transfer agreement.

25. As to the employment contract allegedly concluded with the player, the Respondent acknowledged being in negotiations with him using the 2014/2015 standard template of the Football Federation of country I. However, the Respondent held that it remained undisputed that the negotiations were not for the season 2014/2015 but for the season 2015/2016 and the subsequent ones and that the contract provided by the Claimant was only signed by the player, who never asked the Respondent for an alike signature. As a result, the Respondent was of the opinion that the player could have put his signature with the intention to take advantage of the situation.

26. Lastly, the Respondent requested that the Claimant be ordered to pay the costs of the proceedings and to reimburse the Respondent’s legal fees.

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II. Considerations of the Single Judge of the Players’ Status Committee

1. First of all, the Single Judge of the Players’ Status Committee (hereinafter: the Single Judge) analysed which Procedural Rules are applicable to the matter at hand. In this respect, he referred to the fact that the present matter was submitted to FIFA on 18 January 2016, thus after 1 April 2015. Therefore, the Single Judge concluded that the 2015 edition of the Rules Governing the Procedures of the Players’ Status Committee and the Dispute Resolution Chamber (hereinafter: the Procedural Rules) is applicable to the matter at hand (cf. art. 21 of the Procedural Rules).

2. Subsequently, the Single Judge analysed which edition of the Regulations on the Status and Transfer of Players is 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 Regulations on the Status and Transfer of Players (editions 2015 and 2016) and, on the other hand, to the fact that the claim was lodged before FIFA on 18 January 2016. In view of the foregoing, the Single Judge concluded that the 2015 edition of the Regulations on the Status and Transfer of Players (hereinafter: the Regulations) is applicable to the case at hand as to the substance.

3. Furthermore, the Single Judge confirmed that, on the basis of art. 3 par. 1 and 2 of the Procedural Rules in connection with art. 23 par. 1 and 3 as well as art. 22 lit. f) of the Regulations, he was competent to deal with the present claim since it concerned a dispute between two clubs affiliated to two different associations.

Player F, from country F

4. His competence 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. However, he emphasized that in the following considerations he will only refer to the facts, arguments and documentary evidence which he considered pertinent for the assessment of the matter at hand.

5. To start with, the Single Judge noted that the Claimant and the Respondent concluded on 1 August 2015 a transfer agreement for the transfer of the player from the Claimant to the Respondent, according to which the latter would pay a transfer fee amounting to EUR 1,000,000 to the former, payable in two equal instalments within 15 days following the receipt of the ITC and by no later than 31 January 2016 respectively. Equally, the Single Judge noted that the parties agreed upon three conditional transfer fees linked to the player’s participation in matches with the Respondent, totally amounting to EUR 600,000, and a sell-on clause of 40% of any amount received by the Respondent over EUR 1,000,000 and any conditional transfer fee to be received by the Claimant.

6. At this stage, the Single Judge emphasised that, although the parties contested the date of signature of the transfer agreement, it remained undisputed that the latter agreement was indeed concluded by the parties.

7. In continuation, the Single Judge reverted to the submissions of the parties and underlined, in particular, that the Claimant requested the payment of EUR 1,600,000 for the transfer of the player to the Respondent as well as 40% of the hypothetical subsequent transfer of the player to a third club, whereas the Respondent, for its part, considered that no amount was payable according to clause 6 of the transfer agreement and the fact that the player was never registered with it.

8. Having duly examined the argumentation and documentation put forward by both parties, the Single Judge turned his attention to the wording of the transfer agreement and, in particular, to its clause 6 which stated that “[T[he agreement is conditioned to the release by the Football Federation of country I of the registration as professional player of the Player”.

9. In this respect, the Single Judge was eager to underline that the parties had unambiguously agreed upon a suspensive condition in the transfer agreement. In other words, the effectivity of the transfer agreement was subject to the registration of the player as a professional player.

10. In continuation, the Single Judge, referring to the content of art. 12 par. 3 of the Procedural Rules, which stipulates that any party claiming a right on the basis of an alleged fact shall carry the burden of proof, took into account that it remained undisputed by the parties that

Player F, from country F the player was never registered with the Respondent. Consequently, he concluded that the triggering element of the suspensive condition was met, resulting in the ineffectiveness of the transfer agreement and, therefore, the Single Judge decided to reject the Claimant’s claim.

11. Having decided on the aforementioned and turning his attention to the Claimant’s request related to the reimbursement of the costs of its legal defence, the Single Judge referred to art. 18 par. 4 of the Regulations, in accordance with which no procedural compensation shall be awarded in proceedings before the Players’ Status Committee and the DRC. Therefore, the Single Judge decided that this part of the Claimant’s claim had also to be rejected.

12. Lastly, 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 proceedings before the Players’ Status Committee including its Single Judge, costs in the maximum amount of CHF 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).

13. In respect of the above, and taking into account that the claim of the Claimant had been rejected, the Single Judge concluded that the Claimant has to bear the costs of the current proceedings before FIFA.

14. 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. On that basis, the Single Judge held that the amount to be taken into consideration in the present proceedings is EUR 1,600,000. Consequently, the Single Judge concluded that the maximum amount of costs of the proceedings corresponds to CHF 25,000.

15. In conclusion, and considering the specific circumstances of the case, the Single Judge determined the costs of the current proceedings to the amount of CHF 20,000, which shall be borne by the Claimant.

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III. Decision of the Single Judge of the Players’ Status Committee

1. The claim of the Claimant, Club A, is rejected.

2. The final amount of costs of the proceedings in the amount of CHF 20,000 are to be paid by the Claimant to FIFA. Given that the latter has already paid the amount of CHF 5,000 as advance of costs at the start of the present proceedings, the amount of CHF 15,000 has to

Player F, from country F be paid by the Claimant within 30 days of notification of the present decision to FIFA to the following bank account with reference to case nr.:

UBS Zurich

Account number 366.677.01U (FIFA Players’ Status)

Clearing number 230

IBAN: CH27 0023 0230 3666 7701U

SWIFT: UBSWCHZH80A

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Note relating to the motivated decision (legal remedy):

According to art. 58 par. 1 of the FIFA Statutes, this decision may be appealed against before the Court of Arbitration for Sport (CAS). The statement of appeal must be sent to the CAS directly within 21 days of receipt of notification of this decision and shall contain all the elements in accordance with point 2 of the directives issued by the CAS, 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

For the Single Judge of the

Players’ Status Committee:

Marco Villiger

Deputy Secretary General

Encl. CAS directives