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 13 October 2015

Decision of the Single Judge

of the Players’ Status Committee

passed in Zurich, Switzerland, on 13 October 2015,

by

Geoff Thompson (England)

Single Judge of the Players’ Status Committee,

on the claim presented by the club

Club A, Country B

as “Claimant”

against the club

Club C, Country D

as “Respondent”

regarding a contractual dispute between the parties

relating to the Player E.

Player E

I. Facts of the case

1. On 13 January 2014, the Club of Country B Club A (hereinafter: the Claimant) and the Club of Country D Club C (hereinafter: the Respondent) concluded an agreement (hereinafter: the transfer agreement) for the transfer of the Player E (hereinafter: the player) from the Claimant to the Respondent for a transfer compensation of EUR 4,737,000, payable in two instalments of EUR 3,158,000 on or before 25 January 2014 and of EUR 1,579,000 on or before 30 August 2014, respectively.

2. Moreover, clause 2.6. the transfer agreement stipulated that in case of untimely payment, the Respondent was obliged to pay a “penalty” of 20% p.a. on the outstanding amount.

3. On 21 October 2014, the Claimant lodged a claim in front of FIFA requesting from the Respondent the payment of EUR 1,579,000, plus interest at a rate of 20% p.a. as from 30 August 2014.

4. In support of its claim, the Claimant stated that, after receiving the first instalment of the transfer compensation from the Respondent, the latter failed to comply with its contractual obligations. In this regard, the Claimant pointed to a correspondence of 3 September 2014 it received from the Respondent in which the latter club generally acknowledged its debt and asked for a postponement of the payment until 5 October 2014, which was rejected by the Claimant.

5. In its reply to the claim of the Claimant, the Respondent argued that, since the payment of transfer compensation was not a circumstance which was governed by the “FIFA Regulations on the Status and Transfer of Players”, Swiss law shall apply on the present matter. Consequently, the Respondent held that where an obligation is due, the obligor is in default as soon as he receives a formal reminder from the obligee, which, in the present case, did not happen as it never received a formal default notice from the Claimant.

6. As to the Claimant’s request for default interest at a rate of 20% p.a., the Respondent stressed out that such rate shall be considered disproportionate and referred to the jurisprudence of the Court of Arbitration for Sport (CAS) in this regard.

7. After the investigation phase has been concluded, the Claimant provided an additional unsolicited correspondence, by means of which it argued that the penalty rate of 20% p.a. should be considered proportionate as it was freely contractually agreed between the parties. As to the allegation of the Respondent that it was never formally put in default, the Claimant provided copies of the e-mail exchanges between the clubs dated 2 September 2014, by means of which the parties discussed the postponement of the outstanding amount.

Player E

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 which edition of the Rules Governing the Procedures of the Players’ Status Committee and the Dispute Resolution Chamber (hereinafter: Procedural Rules) were applicable to the matter at hand. In this respect, he took note that the present matter was submitted to FIFA on 21 October 2014. Consequently, the Single Judge concluded that the 2014 edition of the Rules Governing the Procedures of the Players’ Status Committee and the Dispute Resolution Chamber (hereinafter: “the Procedural Rules”) is applicable in 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 should be applicable as to the substance of the matter. In this respect, he recalled that the present matter was submitted to FIFA on 21 October 2014 and, therefore, concluded that the 2014 edition of Regulations on the Status and Transfer of Players (hereinafter: “the Regulations”) is applicable in the matter at hand as to the substance (cf. art. 26 par. 1 and par. 2 of the Regulations).

3. Furthermore, with regard to his competence, 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 2014 edition of the Regulations on the Status and Transfer of Players he is competent to deal with the matter at stake, which concerns a dispute between two football clubs affiliated to two different associations.

4. His competence and the applicable regulations having been established, and entering into the substance of the present matter, the Single Judge started by acknowledging the above mentioned facts of the dispute, the arguments of the parties as well as the documentation contained in the file.

5. In doing so and to start with, the Single Judge noted that, on 13 January 2014, the Claimant and the Respondent had concluded a transfer agreement which provided that the Claimant was entitled to receive from the Respondent the total amount of EUR 4,737,000 as transfer fee, payable in two instalments of EUR 3,158,000 on or before 25 January 2014 and EUR 1,579,000 on or before 30 August 2014, respectively. Furthermore, the Single Judge also acknowledged that clause 2.6 of the transfer agreement, which stipulated that, in case of untimely payment, the Respondent was obliged to pay a “penalty” of 20% p.a. on the outstanding amount.

Player E

6. In continuation, the Single Judge acknowledged that, in its claim to FIFA, the Claimant had declared that the first instalment had been duly paid by the Respondent and had requested from the latter the payment of the second instalment instalment of the transfer fee due amounting to a total of EUR 1,597,000 as well as interest at a rate of 20% p.a. as from 30 August 2014.

7. Equally, the Single Judge observed that, for its part, the Respondent had not contested owing the sum of EUR 1,597,000 to the Claimant, nevertheless, the Single Judge noted that the Respondent argued that, according to the allegedly applicable Swiss Law, he was not obliged to fulfill its contractual obligations as the Claimant had not yet provided the Respondent with a formal default notice.

8. In this respect and for the sake of good order, the Single Judge was eager to stress out that, when deciding a dispute before the FIFA deciding bodies, FIFA’s regulations prevail over any national law possibly chosen by the parties. In this regard, the Single Judge emphasized that the main objective of the FIFA regulations is to create a standard set of rules to which all the actors within the football community are subject to and can rely on. This objective would not be achievable if the FIFA deciding bodies would have to apply the national law of a specific party on every dispute brought to it. The Single Judge emphasized that it is in the interest of football top have uniform criteria rather than provisions of national law that may vary considerable from country to country. Therefore, the Single Judge deemed that, even if the parties would have chosen any national, it is not appropriate to apply the principles of a particular national law but rather FIFA’s regulations, general principles of law and, where existing, the Players’ Status Committee’s well-established jurisprudence.

9. With the aforementioned considerations in mind and considering the correspondence dated 3 September 2014 sent by the Respondent to the Claimant, by means of which the Respondent acknowledged the outstanding payment of the second instalment towards the Claimant and declared its intention to pay such instalment on 5 October 2014 as well as taking into account the legal principle of pacta sunt servanda, which in essence means that agreements must be respected by the parties in good faith, the Single Judge concluded that the Respondent must fulfil its obligations established in the transfer agreement and, consequently, is liable to pay to the Claimant the outstanding amount of EUR 1,597,000.

10. Finally and with regard to the Claimant’s request related to the payment of interest at a rate of 20% p.a., the Single Judge was eager to refer to the well-established jurisprudence of the Players’ Status Committee, according to which an interest rate of 20% p.a. is considered excessive. Consequently, the Single Judge

Player E decided to grant interest at a rate of 5% p.a. over the outstanding amount of EUR 1,597,000.

11. In conclusion, the Single Judge decided that the claim of the Claimant is partially accepted and that the Respondent has to pay to the Claimant the total amount of EUR 1,579,000, plus interest at a rate of 5% p.a. on the said amount from 31 August 2014.

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 the proceedings before the Players’ Status Committee, including the Single Judge, costs in the maximum amount of CHF 25,000 are levied. 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 this respect, the Single Judge reiterated that the claim of the Claimant is partially accepted and that the Respondent is the party at fault. Therefore, the Single Judge decided that the Respondent has to bear the entire costs of the current proceedings in front of 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. Consequently and taking into account that the total amount at dispute in the present matter is EUR 1,597,000, the Single Judge concluded that the maximum amount of costs of the proceedings corresponds to CHF 25,000.

15. In conclusion, and considering that the specificities of the present matter, the Single Judge determined the costs of the current proceedings to the amount of CHF 20,000.

16. Consequently, the Respondent has to pay the amount of CHF 20,000 in order to cover the costs of the present proceedings.

Player E

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

1. The claim of the Claimant, Club A, is partially accepted.

2. The Respondent, Club C, has to pay to the Claimant, Club A, within 30 days as from the date of notification of this decision, the total amount of EUR 1,579,000 as well as 5% interest per year on the said amount from 31 August 2014 until the date of effective payment.

3. If the aforementioned sum, plus interest, is not paid within the stated time limit, the present matter shall be submitted, upon request, to FIFA’s Disciplinary Committee for consideration and a formal decision.

4. Any further claims lodged by the Claimant, Club A, are rejected.

5. The final costs of the proceedings in the amount of CHF 20,000 are to be paid by the Respondent, Club C, within 30 days as from the date of notification of the present decision as follows:

5.1. The amount of CHF 15,000 has to be paid to FIFA to the following bank account:

UBS Zurich

Account number 366.677.01U (FIFA Players’ Status)

Clearing number 230

IBAN: CH27 0023 0230 3666 7701U

SWIFT: UBSWCHZH80A

5.2. The amount of CHF 5,000 has to be paid directly to the Claimant, Club A.

Player E

6. The Claimant, Club A, is directed to inform the Respondent, Club C, immediately and directly of the account number to which the remittances under points 2. and 5.2. above are to be made and to notify the Players’ Status Committee of every payment received.

*****

Note relating to the motivated decision (legal remedy):

According to article 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

For the Single Judge of the

Players’ Status Committee

Marco Villiger

Deputy Acting Secretary General

Encl. CAS Directives