F.I.F.A. – Players’ Status Committee / Commissione per lo Status dei Calciatori – club vs club disputes / controversie tra società – (2020-2021) – fifa.com – atto non ufficiale – Decision 26 January 2021

Decision of the

Single Judge of the Players’ Status Committee

passed on 26 January 2021

regarding a dispute concerning the transfer of the player Krister Tobers

BY:

Johan van Gaalen (South Africa), Single Judge of the PSC

CLAIMANT:

FK Liepaja, Latvia

Represented by Libra Law

RESPONDENT:

Klub Sportowy Lechia Gdansk, Poland

Represented by Zoran Rasic

I. FACTS OF THE CASE

1. On 17 January 2020, the Latvian club FK Liepaja (hereinafter: Claimant), and the Polish club, Klub Sportowy Lechia Gdansk (hereinafter: Respondent) signed a loan agreement (hereinafter: the Agreement) regarding the player Krister Tobers (hereinafter: the player).

2. In accordance with art. 2 of the Agreement, the player was loaned from the Claimant to the Respondent from 20 January 2020 until 30 June 2020.

3. As per art. 4 of the Agreement, the parties agreed that “the transfer on a loan basis of the Player is free of charge”.

4. Moreover, it was agreed that “FK Liepaja granted Lechia Gdansk the exclusive option to acquire on a permanent basis 100% of the federative, economic and sportive rights of the player from the 1st July 2020 provided that the Player will play 5 official matches in polish Ekstraklasa. In such case the buying option is automatically activated and the clubs and the following conditions will become due” as follows (copied verbatim):

“In the event of the permanent transfer of the Player to Lechia Gdansk is obligated to pay FK Liepaja amount of 100 000,00 eur (one hundred thousand euro) till 10 working days on the basis of a valid VAT invoice and a valid certificate of tax residence issued by FK Liepaja (…)”

5. Additionally, the Agreement states (quoted verbatim):

“Lechia Gdansk confirms that FK Liepaja will be entitled to additional remunerations after fulfilling the following conditions during the valid employment contract with Lechia Gdansk only:

a. 50 000 eur net due to the Club it the player has played 5 matches in polish professional league, name Ekstraklasa;

b. 50 000 eur net due to the Club it (sic) the player has played 10 matches in polish professional league, name Ekstraklasa (…)”

6. On 5 and 6 March 2020, the Claimant noted that the player had played in five matches with the Respondent, thus triggering the permanent move of the player. As such, the Respondent sent a correspondence to the Claimant asking whether it could put 15 April 2020 as the due date of EUR 100,000 on the relevant invoice. However, the Claimant insisted that the due date would be 16 March 2020. In this context, the Respondent asked the Claimant whether it could pay EUR 25,000 on 16 March 2020 and EUR 75,000 on 15 April 2020.

7. On 19 March 2020, the Respondent acknowledged receipt of the Claimant’s invoice and informed that “unfortunately we will have a small delay with the payment” due to the COVID-19 pandemic and the suspension of the league, but assured that it would be made by the following week.

8. On 23 March 2020, the Respondent reiterated that it would “make the payment as soon as possible”.

9. On 3 April 2020, upon request of the Claimant, the Respondent stated that “unfortunately at this moment we have no possibility to make this payment” as it was “waiting for revenues/payments due to us”.

10. By means of a letter dated 21 May 2020, the Respondent informed the Claimant that the payment of EUR 100,000 in the case of a permanent transfer would be due “within 10 working days” as per the loan agreement. In this context, the Respondent claimed the following (quoted verbatim):

“Pursuance to FIFA RSTP, it may not be considered that the Permanent Transfer could take place before the end of the loan agreement (30th June 2020). As the loan cannot be converted into permanent transfer of the Player before the 30th June 2020, alto the payment of the Permanent Transfer Fee shall not be due before that date.

The payment of the Permanent Transfer Fee shall be due within 10 days following the Permanent Transfer of the Player, not the activation of the option clause. Otherwise, in order to secure the payment of the Permanent Transfer Fee before the date of the Permanent Transfer of the Player, parties shall agree that such payment is due in the event of the automatically activation of the option clause.”

As stated above, payment of 100 000, 00 EUR as requested by FK Liepaja in the letter dated 7th May 2020, is not due until 10th July 2020.”

11. On 1 July 2020, the Claimant issued an invoice for the payment of EUR 100,000 due on 10 July 2020.

12. On 10 July 2020, the Claimant issued an invoice for the payment of EUR 50,000 due on 10 August 2020.

13. On 15 July 2020, the Claimant noted that the payment of EUR 100,000 had not been received by the Respondent.

14. On 18 July 2020, the Respondent informed the Claimant that it was facing financial difficulties due to the COVID-19 pandemic, in particular due to the fact that its revenues from sponsorship agreements and media rights were suspended. In this regard, the Respondent asked the Claimant for its understanding of the situation.

15. In a letter dated 23 July 2020, the president of the Claimant confirmed that given the specific circumstances of COVID-19, he granted the Respondent a deadline of 15 August 2020 to make the payment of amounts EUR 100,000 and EUR 50,000.

16. By means of WhatsApp conversation between parties’ representatives, the Respondent confirmed on numerous occasions that the payment would be made.

II. PROCEEDINGS BEFORE FIFA

17. On 2 September 2020, the Claimant filed the claim at hand before FIFA. A brief summary of the position of the parties is detailed in continuation.

a. The claim of the Claimant

18. According to the Claimant, the automatic option for the transfer was triggered meaning that the due date for the payment of EUR 100,000 was ”10 working days from 1 July 2020, i.e. 15 July 2020”. Moreover, the Claimant argued that since the player played a total of 10 matches for the Respondent so far, the payment of EUR 50,000 is due within 30 days as from 4 July 2020, i.e. by 14 August 2020.

19. According to the Claimant, the Respondent never challenged that the payments were due, it only mentioned that it had financial difficulties.

20. The Claimant further argued that the letter sent on 23 July 2020 to the Respondent was a default notice fulfilling the criteria of art. 12bis of the FIFA Regulations on the Status and Transfer of Players. Therefore, the Claimant considered that the payment of EUR 100,000 had been delayed for more than 30 days, thus rendering art. 12bis applicable.

21. The requests for relief of the Claimant, were the following:

- EUR 100,000 + 5% interest as from 15 July 2020 until the date of effective payment;

- EUR 50,000 + 5% interest as from 14 August 2020 until the date of effective payment;

- Sanction imposed on the Respondent as per art. 12bis.

b. Position of the Respondent

22. According to the Respondent, due to the COVID-19 pandemic, the season in Poland was extended until the end of July 2020 and that the registration period officially opened on 1 August 2020. Due to the COVID-19 situation, the Respondent argued to have faced financial difficulties, in particular with regard to “the suspension of TV rights, sponsorships, ticketing and given that other clubs such as Sassuolo Calcio were also unable to pay transfer fees” to the Respondent.

23. The Respondent acknowledged that the definite transfer was triggered after 5 matches were played by the player on 4 March 2020.

24. According to the Respondent, the parties’ intention was clear, the loan of the player was free meaning that even with the definite transfer being triggered, no transfer fee shall be due until 30 June 2020, i.e. end of the loan.

25. The Respondent further argued that the payment of the additional payments may only be due after the permanent transfer of the player, i.e. after 30 June 2020. To decide otherwise, in the Respondent’s opinion, would mean that the loan was not free of charge.

26. The Respondent then referred to art. 18 of the Swiss Code of Obligations which, according to their submissions, governs the interpretation of contracts. As such, the Respondent argued that the loan was concluded free of charge and that the Respondent could have expected in good faith that all amounts would only be due later once the transfer the player had become permanent.

27. The Respondent further argued that the transfer fee is in reality EUR 95,000 instead of EUR 100,000 since it was agreed that the solidarity contribution would be deducted and distributed by the Respondent to former clubs. As such, the Respondent explained that it paid the transfer fee on 9 September 2020.

28. The Respondent further explained that on 9 September 2020, it asked the Claimant to issue an invoice for the payment of EUR 2,774 corresponding to the solidarity contribution due to the Claimant. The Respondent complained not to have received said invoice and held that it would pay said amount in the upcoming days even without an invoice in order to comply with its contractual obligations.

29. The Respondent acknowledged that the bonuses would become due as from 1 August 2020 when the season begins. As such, the respondent argued that the first bonus of EUR 50,000 became due on 4 July 2020, so payable by 14 August 2020. In this context, the Claimant did not put the Respondent in default and did not grant the Respondent a 10-day deadline to comply with its financial obligations. Moreover, the letter dated 23 July 2020 sent by the Claimant may not be considered a valid default notice.

30. The requests for relief of the Respondent were that the claim be rejected and that “the Claimant be sentenced to pay all costs of the proceedings”.

III. CONSIDERATIONS OF THE SINGLE JUDGE OF THE PLAYERS’ STATUS COMMITTEE

a. Competence and applicable legal framework

31. First of all, the Single Judge of the Players’ Status Committee (hereinafter also referred to as the Single Judge) analysed whether he was competent to deal with the case at hand. In this respect, he took note that the present matter was presented to FIFA on 3 September 2020 and submitted for decision on 26 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 aforementioned edition of the Procedural Rules is applicable to the matter at hand.

32. Subsequently, the Single Judge referred to art. 3 par. 1 of the Procedural Rules and observed that in accordance with art. 23 par. 1 in combination with art. 22 lit. f) of the Regulations on the Status and Transfer of Players (edition January 2021), the Single Judge is competent to deal with the matter at stake, which concerns a contractual dispute between with an international dimension between a Latvian club and a Polish 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 3 September 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 Single Judge 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 Single Judge stressed the wording of art. 12 par. 4 of the Procedural Rules, pursuant to which he may consider evidence not filed by the parties.

35. In this respect, the Single Judge 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 Single Judge and the applicable regulations having been established, the Single Judge entered into the merits of the dispute. 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.

i. Main legal discussion and considerations

37. The foregoing having been established, the Single Judge moved to the substance of the matter, and took note of the fact that it is uncontested by the parties that at the time of the claim, the total amount of EUR 150,000 was outstanding by the Respondent to the Claimant.

38. Moreover, upon request by FIFA, the Claimant confirmed that it received EUR 95,000 from the Respondent “representing the first instalment on the transfer of Mr Tobers minus the solidarity contribution”. In this regard, the Claimant stated that the payment was made “at the beginning of the month of September, after the filing of the statement of claim with FIFA”.

39. The Single Judge point to the fact that the Respondent would still have to pay EUR 50,000 to the Claimant. However, the Single Judge acknowledged that the solidarity contribution must be deducted from the mentioned amount in accordance with art 21 and Annexe 5 of the Regulations.

40. Once the above had been established, the Single Judge turned to the matter of interest. In this regard, and following the request made by the Claimant and constant DRC/PSC jurisprudence, it would be just correct to grant 5% interest as from the date the amount was due.

41. Scrutinising the documentation on file, the Single Judge was able to determine that the applicable date for interest in this matter was 14 August 2020 in accordance with the Agreement.

42. Lastly, the Single Judge referred to the Claimant’s claim for the payment of interest on the late payment of EUR 95,000 and deemed that it should be accepted as the payment was made undisputedly late and even after the claim at hand was filed triggering thus the entitlement of the Claimant.

43. In this regard, the Single Judge determined that the aforementioned amount was due on 15 July 2020 as per the Claimant’s request and according to the evidence on file was paid on 9 September 2020.

44. Finally, the Single Judge highlighted that the case at hand did not meet the criteria enshrined in art. 12bis of the Regulations and hence that no sanctions were to be imposed on the Respondent on such account.

45. Therefore, based on the principle of pacta sund servanda, the Single Judge concluded that the claim shall be partially accepted and that the Respondent shall pay EUR 47,500 to the Claimant as outstanding remuneration as per the Agreement, comprising of the amount of EUR 50,000 minus EUR 2,500 corresponding to the deductible solidarity contribution established under art. 21 of the Regulations.

ii. Compliance with monetary decisions

46. Finally, taking into account the applicable Regulations, 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.

47. In this regard, the Single Judge 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.

48. 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, 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.

49. The Single Judge 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.

50. Lastly, the Single Judge concluded his deliberations by rejecting any other requests for relief made by any of the parties.

d. Costs

51. Lastly, the Single Judge referred to article 18 par. a lit. 1) of the Procedural Rules, according to which no costs shall be levied by the parties for claims lodged between 10 June 2020 and 31 December 2020 (both inclusive). Accordingly, the Single Judge decided that no procedural costs were to be imposed on the parties.

52. Likewise, and for the sake of completeness, the Single Judge recalled the contents of art. 18 par. 4 of the Procedural Rules, and decided that no procedural compensation shall be awarded in these proceedings.

IV. DECISION OF THE SINGLE JUDGE OF THE PLAYERS’ STATUS COMMITTEE

1. The claim of the Claimant, FK Liepaja, is partially accepted.

2. The Respondent, Klub Sportowy Lechia Gdańsk, has to pay to the Claimant, the following:

- 5% annual interest on the amount of EUR 95,000 from 15 July 2020 until 9 September 2020.

- EUR 47,500 as outstanding amount plus 5% interest p.a. as from 14 August 2020 until the date of effective payment.

3. Any further claims of the Claimant are rejected.

4. 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 point 2 above.

5. The Respondent shall provide evidence of payment of the due amount in accordance with point 2 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).

6. In the event that the amount due plus interest in accordance with point 2 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).

7. The ban mentioned in point 6 above will be lifted immediately and prior to its complete serving, once the due amount is paid.

8. 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.

9. This decision is rendered without costs.

For the Single Judge of the PSC

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).

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