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 23 February 2021

Decision of the Single Judge of the

Players Status Committee

passed on 23 February 2021

regarding a dispute concerning the transfer of the player Jandrei Chitolina Carniel

BY:

Roy Vermeer (Netherlands), Single Judge of the PSC

CLAIMANT:

Associação Chapecoense de Futebol, Brazil

Represented by Mr. Marcelo Amoretty Souza

RESPONDENT:

Genoa CFC, Italy

I. FACTS OF THE CASE

1. On 20 January 2019, the Italian club, Genoa CFC (hereinafter: the Respondent), and the Brazilian club, Associação Chapecoense de Futebol (hereinafter: the Claimant), signed a transfer agreement by means of which the player, Mr. Jandrei Chitolina Carniel (hereinafter: the player), was transferred from the latter to the former (hereinafter: the transfer agreement).

2. In accordance with clause 2.1 of the transfer agreement, the transfer fee established by the parties amounted to EUR 2,400,000, payable as follows:

a. EUR 1,200,000 by 31 January 2019; and

b. EUR 1,200,000 by 30 May 2019.

3. On 29 July 2019, the same parties signed an amendment to the transfer agreement (hereinafter: the first amendment), by means of which it was agreed, in its clause 2, that the Respondent would pay to the Claimant the total amount of EUR 1,159,413.84 as follows:

a. EUR 285,000 by 31 July 2019;

b. EUR 285,000 by 31 August 2019;

c. EUR 285,000 by 30 September 2019; and

d. EUR 304,413.84 by 31 October 2019.

4. Furthermore, clause 4 of the first amendment provided the following: “in the event that [the Respondent] fails to pay any of the amounts set forth by Clause 2 of this Agreement within 5 (five) days of the relevant payment becoming due, [the Respondent] shall pay a penalty in the amount of EUR 90,000 (ninety thousand euros)”.

5. On 10 July 2020, the Claimant sent the Respondent a default notice, granting it a 10 days’ deadline in order to pay the outstanding transfer compensation in the amount of EUR 150,000, plus penalty of EUR 90,000.

6. On 24 July 2020, the parties signed a second amendment to the transfer agreement (hereinafter: the second amendment), by means of which it was agreed, in its clause 1, that the Respondent would pay to the Claimant the total amount of EUR 150,000 as follows:

a. EUR 50,000 by 3 August 2020;

b. EUR 50,000 by 31 August 2020; and

c. EUR 50,000 by 30 September 2020.

7. In addition, clause 3 of the second amendment established the following: “The Parties covenant and agree that in the event that [the Respondent] fails to pay any of the amounts set forth by Clause 1 of this Second Agreement within 5 (five) of the relevant payment becoming due, [the Respondent] shall pay a penalty in the amount of EUR 30,000 (thirty thousand euros), regarding each instalment delayed. [The Respondent] waives its right to challenge the amount of the penalty before the judging bodies. SWIFT copy proves that the payment is made timely”.

8. On 1 October 2020, the Claimant sent the Respondent a second default notice, granting it another 10 days’ deadline in order to pay the outstanding transfer compensation in the amount of EUR 100,000, plus penalty of EUR 60,000.

II. PROCEEDINGS BEFORE FIFA

9. On 13 October 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

10. According to the Claimant, after the Respondent failed to pay the second instalment of the transfer agreement, the parties concluded the first amendment in order to solve the controversy amicably.

11. Nonetheless, the Claimant informed that the Respondent once again failed to pay the fourth instalment agreed by the parties, reason why they concluded the second amendment to the transfer agreement.

12. However, as per the Claimant’s statement of claim, the second and the third instalments stipulated by the parties remained unpaid. In this regard, the Claimant stated that it is entitled to receive the total amount of EUR 160,000, being EUR 100,000 for the outstanding remuneration and the remaining EUR 60,000 regarding the penalty for each instalment delayed (as per clause 3 of the second amendment).

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

a. To condemn the Respondent to pay the amount of EUR 160,000, as described above;

b. To impose on the Respondent the sanctions established in art. 12bis, par. 4 of the FIFA RSTP;

c. To recognize that no advance of costs was due;

d. To order the Respondent to “repay to the Claimant any contribution towards the legal and other costs incurred and regarding the ongoing proceeding in an amount to be duly established at the discretion of this Court”.

b. Position of the Respondent

14. In its reply, the Respondent acknowledged its debt and referred to its will to honour the commitments towards the Claimant. In this regard, the Respondent underlined that its financial situation was not made easier with the COVID-19 pandemic.

15. Notwithstanding the above, the Respondent contested the application of the penalty, which was considered to be excessive. Accordingly, the Respondent once again referred to the pandemic and remarked that the penalty represents 60% of the debt.

16. Consequently, the Respondent sustained that, if the penalty is deemed to be applied, it should be significantly reduced.

17. In conclusion, the Respondent made the following statement: “In any event, we are very much hoping that this matter will be resolved prior to any formal decision being taken. We are pleased to inform you that we expect that the overdue amounts of EUR 100,000 will be paid to the Claimant shortly. In the meantime, for the reasons stated above, we would be very grateful if the Players’ Status Committee could refrain from imposing any sanctions on our club”.

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

a. Competence and applicable legal framework

18. First of all, the Single Judge of the Players’ Status Committee (hereinafter also referred to as 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 13 October 2020 and submitted for a decision on 23 February 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.

19. 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 February 2021), the Players’ Status Committee is competent to deal with the matter at stake, which concerns an international dispute between clubs belonging to different associations, i.e. a Brazilian club and an Italian club.

20. Subsequently, the Single Judged 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 February 2021), and considering that the present claim was lodged on 13 October 2020, the October 2020 edition of said regulations (hereinafter: the Regulations) is applicable to the matter at hand as to the substance.

b. Burden of proof

21. 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.

22. 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

23. The competence of the Players’ Status Committee 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

24. The foregoing having been established, the Single Judge moved to the substance of the matter, and took note of the fact that the Respondent acknowledged its debt towards the Claimant and referred to the COVID-19 pandemic in order to justify the lack of payment.

25. Having said this, the Single Judge highlighted that FIFA issued a set of guidelines, the COVID-19 Guidelines, which aim at providing appropriate guidance and recommendations to member associations and their stakeholders, to both mitigate the consequences of disruptions caused by COVID-19 and ensure that any response is harmonised in the common interest. Moreover, on 11 June 2020, FIFA has issued an additional document, referred to as FIFA COVID-19 FAQ, which provides clarifications on the most relevant questions in connection with the regulatory consequences of the COVID-19 outbreak and identifies solutions for new regulatory matters.

26. In this context, the Single Judge noted that the Respondent did not file together with its reply any documentation pertaining to the question of the COVID-19 pandemic. Consequently, the Single Judge underlined that the Respondent failed to meet its burden of proof in accordance with the aforementioned art. 12 par. 3 of the Procedural Rules insofar as the FIFA COVID FAQ, in its question no. 1, establishes that the Bureau of the FIFA Council did not determine that the COVID-19 outbreak was a force majeure situation in any specific country or territory, or that any specific employment or transfer agreement was impacted by the concept of force majeure; rather, it provides that whether or not a force majeure situation (or its equivalent) exists in the country or territory is a matter of law and fact, which must be addressed on a case-by-case basis vis-à-vis the relevant laws that are applicable to any specific employment or transfer agreement.

27. Additionally, the Single Judge wished to outline that he could not uphold the argumentation of the Respondent since the relevant payment in dispute fell due before the outbreak of the COVID-19 pandemic. Further, the Single Judge also stressed that the payments were renegotiated twice and, even so, part of the remuneration remained unpaid. To this end, the Single Judge was firm to determine that clubs are required to comply with their financial obligations, especially those assumed before the pandemic as in the matter at hand.

28. On account of the aforementioned considerations, the Single Judge established that the Respondent failed to remit the Claimant’s remuneration in the amount of EUR 100,000, in accordance the second amendment to the transfer agreement. Consequently, the Single decided that, in accordance with the general legal principle of pacta sunt servanda, the Respondent is liable to pay said amount to the Claimant.

29. In continuation, the Single Judge turned his attention to the content of clause 3 of the second amendment and to the penalty fee therein provided.

30. In this regard, the Single Judge deemed it appropriate to stress that penalty clauses, in principle, may be freely entered into by the contractual parties and may be considered acceptable, in the event that the pertinent written clause meets certain criteria such as proportionality and reasonableness. Accordingly, the Single Judge highlighted that in order to determine as to whether a penalty clause is to be considered acceptable, the specific circumstances of the relevant case brought before the deciding body shall also be taken into consideration.

31. In the specific case at hand and taking into account that the Respondent repetitively breached its commitments towards the Respondent, the Single Judge concluded that the penalty fee of EUR 30,000 for each delayed instalment of the second amendment is both proportionate and reasonable.

32. As a consequence, the Single Judge decided that the Respondent has to pay to the Claimant the additional amount of EUR 60,000 as the penalty fee agreed by both parties in the second amendment to the transfer agreement.

33. 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.

34. Therefore, the Single Judge concluded that the claim shall be partially accepted.

ii. Compliance with monetary decisions

35. 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.

36. 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.

37. 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.

38. 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.

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

d. Costs

40. 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.

41. 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, Associação Chapecoense de Futebol, is partially accepted.

2. The Respondent, Genoa CFC, has to pay to the Claimant the amount of EUR 160,000.

3. Any further claims of the Claimant are rejected.

4. The Claimant is directed to immediately and directly inform the Respondent of the relevant bank account to which the Respondent must pay the due amount.

5. The Respondent shall provide evidence of payment of the due amount in accordance with this decision to psdfifa@fifa.org, duly translated, if applicable, into one of the official FIFA languages (English, French, German, Spanish).

6. In the event that the amount due, plus interest as established 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 following consequences shall arise:

1.

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. The aforementioned ban mentioned will be lifted immediately and prior to its complete serving, once the due amount is paid.

(cf. art. 24bis of the Regulations on the Status and Transfer of Players).

2.

In the event that the payable amount as per in this decision 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 the FIFA Disciplinary Committee.

7. This decision is rendered without costs.

For the Single Judge of the Players’ Status Committee:

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).

CONTACT INFORMATION:

Fédération Internationale de Football Association

FIFA-Strasse 20 P.O. Box 8044 Zurich Switzerland

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