F.I.F.A. – Players’ Status Committee / Commissione per lo Status dei Calciatori – club vs club disputes / controversie tra società – (2019-2020) – fifa.com – atto non ufficiale – Decision 11 February 2020

Decision of the Single Judge

of the Players’ Status Committee

passed in Zurich, Switzerland, on 11 February 2020,

by

José Luis Andrade (Portugal)

Single Judge of the Players’ Status Committee,

on the claim presented by the club,

Fenerbahçe SK, Turkey

represented by Mr Juan de Dios Crespo

as Claimant

against the club,

Al Nassr, Saudi Arabia

represented by Mr Gauthier Bouchat

as Respondent

regarding a contractual dispute arisen between the parties

and relating to the player Giuliano Victor de Paula

I. Facts of the case

1. On 19 August 2018, the Turkish club, Fenerbahçe SK (hereinafter: the Claimant), and the Saudi club, Al Nassr (hereinafter: the Respondent), executed an agreement (hereinafter: the contract) over the transfer of the player Giuliano de Paula (hereinafter: the player) from the Claimant to the Respondent, for a transfer fee of EUR 10,500,000, to be paid as follows:

- EUR 5,000,000 on 6 September 2018;

- EUR 3,500,000 on 28 February 2019;

- EUR 2,000,000 on 1 October 2019.

2. In accordance with clause 2.2 (d) of the contract, in the event the Respondent failed to pay any of the instalments due after twenty days from the due dates had elapsed, and the Claimant had given the Respondent notice of such default, the Respondent was subject to a penalty of EUR 350,000.

3. In accordance with clause 2.3 (b) of the contract, the Claimant was entitled to a bonus of EUR 250,000 in case the player scored or gave more than 15 assists while playing for the Respondent during the course of a season.

4. According to the Claimant, the Respondent failed to pay it the total amount of EUR 3,750,000, corresponding to the second instalment of the transfer fee agreed in the contract, as well as the bonus for goals/assists of the player.

5. By correspondence dated 13 March 2019, the Claimant put the Respondent in default of payment of the amount of EUR 3,750,000, setting a time limit until 22 March 2019 in order to remedy the default.

6. On 2 April 2019, the Claimant lodged a claim against the Respondent in front of FIFA asking that the Respondent be ordered to pay to him amount of EUR 4,100,000, corresponding to the second instalment of the transfer fee of EUR 3,500,000, the bonus for goals/assists of the player of EUR 250,000, and the contractual penalty for late payment in the amount of EUR 350,000.

7. The Claimant further asks to be awarded both “default interest accrued from the due date of the instalment”, and costs and legal fees.

8. In reaction to being informed about the claim, the Respondent, first of all, pointed out that the Claimant did not proceed in accordance with art. 12bis of the FIFA Regulations on the Status and Transfer of Players, by giving a deadline shorter than 10 days to comply with its financial obligations (i.e. from 13 March until 22 March 2019), and without waiting 30 days since the instalment fell due. According to the Respondent, it was not in default when the claim was lodged on 2 April 2019 and, thus, the claim was inadmissible.

9. In any case, the Respondent acknowledged having failed to pay the second instalment and that the bonus envisaged at clause 2.3 (b) of the contract fell due. However, it pointed out that the penalty envisaged by clause 2.2 (d) of the contract is disproportionate and, in light of the fact that it had paid the first instalment on time and the failure to pay the second was due to cash flow shortage, the Respondent asked that the penalty be reduced. Moreover, the Respondent asked that the interest on the penalty be rejected.

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

1. First of all, the Single Judge of the Players’ Status Committee (hereinafter: Single Judge) analysed whether he was competent to deal with the present matter. In this respect, he took note that the present matter was submitted to FIFA on 2 April 2019. Taking into account the wording of art. 21 of the 2019 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.

2. Subsequently, the Single Judge referred to art. 3 paras 2 and 3 of the Procedural Rules and confirmed that in accordance with art. 23 paras 1 and 4 in conjunction with art. 22 lit. f of the Regulations on the Status and Transfer of Players (edition January 2020) he is competent to deal with the matter at stake, which concerns a contractual dispute between clubs affiliated to different associations, i.e a Turkish club and a Saudi club.

3. Furthermore, the Single Judge analysed which regulations should be applicable as to the substance of the matter. In this respect, he confirmed that in accordance with art. 26 par. 1 and par. 2 of the Regulations on the Status and Transfer of Players (edition January 2020), and considering that the present claim was lodged on 2 April 2019, the June 2018 edition of said regulations (hereinafter: Regulations) is applicable to the matter at hand as to the substance.

4. The competence of the Single Judge and the applicable regulations having been established, the Single Judge entered into the substance of the matter. In this respect, the Single Judge started by acknowledging all the above-mentioned facts as well as the arguments and the documentation on file. However, the Single Judge emphasised that in the following considerations he will refer only to the facts, arguments and documentary evidence, which he considered pertinent for the assessment of the matter at hand.

5. Having said this, the Single Judge acknowledged that the Claimant and the Respondent signed a transfer agreement on 19 August 2018, over the transfer of the player from the Claimant to the Respondent, for a transfer fee of EUR 10,500,000, payable in three instalments.

6. The Single Judge further took note of the fact that the parties agreed on a transfer bonus of EUR 250,000, subject to certain conditions regarding the player’s performance, as well as a penalty of EUR 350,000 in case of late penalties, respectively as per clauses 2.2 (b) and 2.3 (d) of the contract.

7. The Claimant lodged a claim against the Respondent in front of FIFA, maintaining that the Respondent owed it the total amount of EUR 4,100,000, corresponding to the second instalment of the transfer fee of EUR 3,500,000, the bonus for goals/assists of the player of EUR 250,000, and the contractual penalty for late payment in the amount of EUR 350,000.

8. In this context, the Single Judge took particular note of the fact that, on 13 March 2019, the Claimant put the Respondent in default of payment of EUR 3,750,000, corresponding to the second instalment of the transfer fee of EUR 3,500,000, and the bonus for goals/assists of the player of EUR 250,000, setting a 9 days’ time limit in order to remedy the default.

9. Subsequently, the Single Judge took into account that the Respondent, for its part and in reply to being informed about the claim of the Claimant, held that the claim was not in default when the claim was filed, rendering it inadmissible as the Claimant did not proceed in accordance with art. 12bis of the FIFA Regulations on the Status and Transfer of Players, by giving a deadline shorter than 10 days to comply with its financial obligations (i.e. from 13 March until 22 March 2019), and without waiting 30 days since the instalment fell due.

10. Additionally, the Single Judge noted that the Respondent acknowledged having failed to pay the second instalment and that the bonus envisaged at clause 2.3 (b) of the contract fell due, and gave due consideration to the Respondent’s submission that the penalty envisaged by clause 2.2 (d) of the contract is disproportionate and, in light of the fact that it had paid the first instalment on time and the failure to pay the second was due to cash flow shortage, the Respondent asked that the penalty be reduced. Finally, the Single Judge observed that the Respondent asked that the interest on the penalty be rejected.

11. From the outset, the Single Judge noted that the parties dispute whether the claim was admissible. To this extent, the Single Judge took note that the parties agreed on a transfer fee of EUR 10,500,000, of which the second instalment in the amount of EUR 3,500,000 fell due on 28 February 2019. Further, the Single Judge observed that the claim was lodged by the Claimant on 2 April 2019, and that the Respondent does not dispute that such second instalment was not paid. As such, the Single Judge concluded that the amount in dispute had already fallen due when the claim was filed, and therefore confirmed that the claim is admissible.

10. Subsequently, the Single Judge turned his attention to the substance of the matter, and considered that the circumstances raised by the Respondent cannot be considered a valid reason for non-payment of the monies claimed by the Claimant, in other words, the reasons brought forward by the Respondent in its defence do not exempt the Respondent from its obligation to fulfil its contractual obligations towards the Claimant.

11. To this extent, the Single Judge emphasized that the Respondent admitted having failed to pay the Claimant EUR 3,500,000 corresponding to the second instalment of the transfer fee, and underlined, with regards to the conditional bonus of EUR 250,000, both that it was due in light of the evidence brought forward by the Claimant, and that the Respondent did not dispute it.

12. Further, the Single Judge addressed the matter of the penalty of EUR 350,000, and concluded that such amount, vis-à-vis the transfer fee amount and the amount due by the Respondent to the Claimant, could not be deem as unfair not disproportionate, and concluded it should be enforced as per clause 2.3 (d) of the contract, which was freely negotiated and entered into by the parties.

13. Consequently, the Single Judge decided to reject the argumentation put forward by the Respondent in its defence.

14. On account of the aforementioned considerations, the Single Judge established that the Respondent failed to pay the Claimant the total amount of EUR 3,750,000, corresponding to the second instalment of the transfer fee of EUR 3,500,000, the bonus for goals/assists of the player of EUR 250,000. As such, the Single Judge decided that the Respondent has to pay the Claimant the contractual penalty of EUR 350,000.

15. Consequently, the Single Judge decided that, in accordance with the general legal principle of pacta sunt servanda, the Respondent is liable to pay to the Claimant the total amount of EUR 4,100,000.

16. In addition, taking into account the Claimant’s request as well as the constant practice of the Dispute Resolution Chamber, the Single Judge decided that the Respondent must pay to the Claimant interest of 5% p.a. on each of the relevant payment(s) as of the day following the day on which the relevant payment(s) fell due, until the date of effective payment.

17. Furthermore, as regards the claimed legal expenses, the Single Judge referred to art. 18 par. 4 of the Procedural Rules as well as to the long-standing and well-established jurisprudence of the Players’ Status Committee, in accordance with which no procedural compensation shall be awarded in proceedings in front of the Players’ Status Committee. Consequently, the Single Judge decided to reject the Claimant’s request relating to legal expenses.

18. What is more, taking into account the consideration under number II./3. above, the Single Judge 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.

19. In this regard, the Single Judge pointed out 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.

20. Therefore, bearing in mind the above, the Single Judge 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, following the notification of the present decision, communicates the relevant bank details to the Respondent, 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.

21. Finally, the Single Judge recalled that the above-mentioned ban 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.

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

1. The claim of the Claimant, Fenerbahçe SK, is admissible.

2. The claim of the Claimant is partially accepted.

3. The Respondent, Al Nassr, has to pay to the Claimant the amount of EUR 3,500,000 plus 5% interest p.a. from 1 March 2019 until the date of effective payment.

4. The Respondent has to pay to the Claimant the amount of EUR 600,000.

5. Any further claim lodged by the Claimant is rejected.

6. The Claimant is directed to inform the Respondent, immediately and directly, preferably to the e-mail address as indicated on the cover letter of the present decision, of the relevant bank account to which the Respondent must pay the amount mentioned under points III./3. and III./4. above.

7. The Respondent shall provide evidence of payment of the due amount in accordance with points III./3. and III./4. above to FIFA to the e-mail address psdfifa@fifa.org, duly translated, if need be, into one of the official FIFA languages (English, French, German, Spanish).

8. In the event that the amount due, plus interest in accordance with points III./3. and III./4. 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 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 (cf. art. 24bis of the Regulations on the Status and Transfer of Players).

9. The ban mentioned in point III./8. above will be lifted immediately and prior to its complete serving, once the due amount is paid.

10. In the event that the aforementioned sum, plus interest, 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 FIFA’s Disciplinary Committee for consideration and a formal decision.

11. The final amount of costs of the proceedings in the amount of CHF 20,000 is to be paid by the Respondent as from the notification of the present decision, as follows:

a) The amount of CHF 5,000 has to be paid to the Claimant;

b) The amount of CHF 15,000 has to be paid to FIFA to the following bank account with reference to case nr. lza/19-00804:

UBS Zurich

Account number 366.677.01U (FIFA Players’ Status)

Clearing number 230

IBAN: CH27 0023 0230 3666 7701U

SWIFT: UBSWCHZH80A

12. In the event that the aforementioned amount of costs 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.

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Note related to the publication:

The FIFA administration may publish decisions issued by the Players’ Status Committee or the DRC. Where such decisions contain confidential information, 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 Rules Governing the Procedures of the Players’ Status Committee and the Dispute Resolution Chamber).

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. 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 (CAS)

Avenue de Beaumont 2, CH-1012 Lausanne

Switzerland

Tel: +41 21 613 50 00

e-mail: info@tas-cas.org

For the Single Judge of the Players’ Status Committee:

Emilio García Silvero

Chief Legal & Compliance Officer