Decision of the Dispute Resolution Chamber
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1 Decision of the Dispute Resolution Chamber passed in Zurich, Switzerland, on 29 July 2016, in the following composition: Geoff Thompson (England), Chairman Santiago Nebot (Spain), member John Bramhall (England), member Guillermo Saltos Guale (Ecuador), member Wouter Lambrecht (Belgium), member on the claim presented by the club, Club A, country B as Claimant against the club, Club C (Club G), country D as Respondent regarding training compensation in connection with the Player E
2 I. Facts of the case 1. According to the player passport provided by the Football Association of country B (hereinafter: Football Association of country B), the player, Player E (hereinafter: the player), born on 11 February 1991, was registered with its affiliated clubs, Club A (hereinafter: Club A or Clamaint) and Club F, as follows: From Until Club Status 1 February December 2010 Club A Amateur 1 January December 2012 Club A Professional 1 February January 2014 Club A Professional 18 January December 2014 Club F Professional (on loan) 1 January 2015 [empty] Club A Professional 2. The sporting season in country B follows the calendar year, i.e. from January to December. 3. The Football Federation of country D confirmed that the player was registered for its affiliated club, Club C (hereinafter: Club C) on 17 July 2014, following a decision of the Single Judge of the Players Status Committee (PSC). 4. From the information in the Transfer Matching System (TMS), it can be noted that Club C belonged to category II of UEFA (indicative amount of EUR 60,000 per season) when the player was registered with it. Furthermore, according to the TMS, the 2014/2015 season in country D started on 25 July 2014 and ended on 31 May On 29 January 2015, Club A lodged a claim in front of FIFA against Club C, claiming the payment of training compensation in the amount of EUR 180,000, plus 5% interest p.a. as from the date on which the payment of training compensation was due. 6. In its claim, Club A explains that the player was on loan with Club F, initially for the period between 18 January 2014 and 31 December However, according to Club A, during January 2014 the player terminated both the employment contract with Club A and the loan agreement with Club F. 7. In reply to the claim of Club A, the club from country D, Club G (hereinafter: Club G) submitted that Club C is under liquidation as from 28 March 2014, therefore it has lost its right to participate in any competition, or even to be a member of the national federation. 2/9
3 8. In addition, according to Club G, the sport organization represented by me is not the legal successor of Club C. Club G further held that it cannot be seen as the legal successor of Club C, since it did not take over its right to play in UEFA Competitions. As a result, Club G held that it has no obligation to pay training compensation in the matter at hand. 9. After being asked for a clarification regarding the legal status of Club C and Club G, on 15 July 2015, the Football Federation of country D confirmed that Club C is no longer affiliated to the Football Federation of country D, that it has lost its right to participate in any of the competitions organized under the auspices of the Football Federation of country D and that it is already liquidated. Furthermore, the Football Federation of country D confirmed that Club G took over the right to participate in the system of competitions of the Football Federation of country D from Club C and that Club C and Club G are the names of the legal entities. 10. In reply to Club G and to the information provided by the Football Federation of country D, Club A argued that Club C and Club G are in fact one and the same club. This because Club G took over the right to participate in the 1st division of the league of country D and the cup of country D, the fact that based on the decision of the Competitions Committee dated 27 March 2014, Club G also overtook obligations of Club C, as well as the circumstance that the club uses a slightly modified name. Further, Club G argued that in February 2014, the player signed a contract with Club C, but that he was only registered on 17 July 2014 (when Club C supposedly disappeared due to liquidation ), which is - according to Club A - a confirmation that Club G and Club C are in fact the same legal entity. 11. Furthermore, Club A stated that from information retrieved from the internet (i.e. Wikipedia and Soccerway), it can be noted that Club C was founded in XXXX, and that Club C and Club G both used the same badge and had the same head coach. Moreover, Club A argues that the information on the internet does not mention that Club C disappeared in Moreover, according to Club A, the official website H does not make a distinction between Club C and Club G. 12. Finally, Club G reiterated that it is not the legal successor of Club C. In this respect, Club G refers to a decision of the Club Licensing Department of UEFA dated 6 October 2014, according to which no exemption to the three-year rule to Club G, an entity which has simply replaced an entity in liquidation could be granted. Moreover, Club G requested the DRC to condemn Club A to pay the legal costs. II. Considerations of the Dispute Resolution Chamber 1. First of all, the Dispute Resolution Chamber (hereinafter also referred to as DRC or Chamber) analysed whether it was competent to deal with the case at hand. In 3/9
4 this respect, it took note that the present matter was submitted to FIFA on 29 January Consequently, the 2014 edition of the Rules Governing the Procedures of the Players Status Committee and the Dispute Resolution Chamber (hereinafter: Procedural Rules) is applicable to the matter at hand (cf. art. 21 of the Procedural Rules). 2. Subsequently, the members of the Chamber referred to art. 3 par. 1 of the Procedural Rules and confirmed that in accordance with art. 24 par. 1 in combination with art. 22 lit. (d) of the Regulations on the Status and Transfer of Players (editions 2014, 2015 and 2016), the Dispute Resolution Chamber is competent to deal with the matter at stake relating to training compensation between clubs belonging to different associations. 3. Furthermore, and taking into consideration that the player was registered with Club C on 17 July 2014, the Chamber analysed which Regulations on the Status and Transfer of Players 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 Players (editions 2014, 2015 and 2016), and considering that the player was registered with Club C on 17 July 2014, the 2012 edition of the Regulations on the Status and Transfer of Players (hereinafter: Regulations) is applicable to the matter at hand as to the substance. 4. The competence of the DRC and the applicable regulations having been established, the DRC entered into the substance of the matter. In this respect, the Chamber started by acknowledging all the above-mentioned facts as well as the arguments and the documentation submitted by the parties. However, the Chamber emphasised that in the following considerations it will refer only to the facts, arguments and documentary evidence, which it considered pertinent for the assessment of the matter at hand. 5. First of all, and before addressing the matter of Club A s entitlement to receive training compensation, the Chamber deemed it appropriate to address the issue of the standing to be sued of and the legal relationship between Club C and Club G. 6. In this respect, the Chamber first noted that even though Club A lodged its claim against Club C, it was Club G who replied to it, stating that Club C is under liquidation as from 28 March 2014 and is no longer affiliated to the Football Federation of country D, as well as that Club G cannot be seen as the legal successor of Club C. Subsequently, the DRC acknowledged the argumentation of Club A, detailed in point I.10 and I.11 above, according to which Club C and Club G are in fact the same legal entity and thus liable to pay training compensation to Club A. 4/9
5 7. In view of the diverging argumentation of the parties, the DRC referred to the content of the official statement provided by the Football Federation of country D (cf. point I.9. above), in which said federation confirmed that Club G took over the right to participate in the system of competitions of the Football Federation of country D from Club C and that Club C and Club G are the names of the legal entities. Based on such declaration, the DRC concluded that Club G is indeed the legal successor of Club C. 8. Furthermore, the DRC referred to the decision taken by the Chamber on 18 February 2016 in a previous case (ref. no. XXXX), in relation to a labour claim lodged by Club A against the player and Club C for breach of contract and inducement respectively. In said decision, the DRC concluded inter alia that Club G and Club C are one and the same club. 9. In the matter at hand, the members of the Chamber deemed it important to underline that there are documents and statements on file, submitted by both Club A as well as the Football Federation of country D, on the basis of which it could be noted that Club G uses inter alia the same name, logo, coach and stadium of Club C, as well as that the history of the clubs seems to be the same. In the DRC s opinion, the most plausible reason for such is precisely to maintain the identity and image of Club C therewith allowing Club G to be perceived by any third party as the same club. 10. On account of all the above and in line with the aforementioned decision taken in the labour dispute with ref. no. XXXX, the members of the Chamber reached the following conclusions: a. There are sufficient elements to establish that Club C has been the same club throughout its history; b. Moreover, by using the same name, logo, coach and stadium, it is evident that the new club had the intention to maintain the identity and image of Club C in order to be considered the same club; c. Club C, both in the form as Club C and Club G, after the registration of the player to its club, concluded an employment contract with the player. 11. In view of the foregoing conclusions, the DRC, in line with its jurisprudence, unanimously decided that Club G is one and the same club as Club C and has standing to be sued in the present proceedings and it is therefore, in the light of Annex 4 of the Regulations, liable to pay training compensation to Club A, in case its entitlement to it is confirmed. Hereinafter, the club shall be referred to as Club C (Club G). 12. Having confirmed the legal identity of Club C and Club G and the standing to be sued of the latter, the Chamber entered into the discussion of Club A s entitlement to receive training compensation. 5/9
6 13. With respect to the foregoing, the members of the Chamber first wished to outline that in the previously mentioned dispute with ref. no. XXXX, regarding the labour claim lodged by Club A against the player and Club C (Club G) for breach of contract and inducement respectively, the DRC concluded that the player unilaterally terminated the employment contract with Club A on 28 January 2014, without just cause. 14. In continuation, the members of the Chamber took note that Club A maintained that it is entitled to receive training compensation from Club C (Club G) in the amount of EUR 180,000, indicating that the player was transferred as a professional from Club A to Club C (Club G) before the end of the season of his 23 rd birthday. 15. Subsequently, the DRC noted that Club C (Club G) did not raise any argument other than its alleged lack of standing to be sued. 16. At this point, the Chamber referred to the rules applicable to cases regarding training compensation and stated that, as established in art. 20 of the Regulations as well as in art. 1 par. 1 of Annexe 4 in combination with art. 2 of Annexe 4 of the Regulations, training compensation is payable, as a general rule, for training incurred between the ages of 12 and 21 when a player is registered for the first time as a professional before the end of the season of the player s 23 rd birthday or when a professional is transferred between clubs of two different associations before the end of the season of the player s 23 rd birthday. In case the latter occurs, art. 3 par. 1 sent. 3 of Annexe 4 of the Regulations sets forth that training compensation will only be owed to the player s former club for the time he was effectively trained by that club. 17. Following the above, the Chamber noted that the Football Federation of country D had confirmed that the player was registered as a professional with Club C (Club G) on 17 July 2014, this is, still in the season of his 23 rd birthday, in accordance with the season dates of the country he was registered in before being transferred, i.e. country B. 18. Equally, the Chamber stressed that, according to the player passport issued by the Football Association of country B, as well as in accordance with the subsequent official confirmation of the Football Association of country B and the information provided by Club A, the player, born on 11 February 1991, was registered with Club A as from 1 February 2010 until 20 December 2010 as an amateur, from 1 January 2011 until 31 December 2012 and from 1 February 2013 until 17 January 2014, as a professional. 6/9
7 19. On account of the above considerations, the DRC decided that Club C (Club G) would be liable to pay training compensation to Club A, which is the player s former club in the sense of art. 3 par. 1 sent. 3 of Annexe 4 of the Regulations, in accordance with art. 20 and Annexe 4 of the Regulations. 20. Turning its attention to the calculation of training compensation, the DRC referred to the FIFA circular no dated 29 April 2010 which provides details for the calculation of training compensation as well as to art. 5 par. 1 and par. 2 of Annexe 4 of the Regulations, which stipulate that as a general rule, to calculate the training compensation due to a player s former club, it is necessary to take the costs that would have been incurred by the new club if it had trained the player itself. 21. In continuation, the Chamber observed that according to the documentation on file, Club C (Club G) belonged to the category II. Moreover, the members of the Chamber established that given the fact training compensation is payable for training incurred between the ages of 12 and 21 the season of the player s 21 st birthday ran from 1 January 2012 until 31 December 2012 and that the relevant period for calculating the amount of training compensation payable by Club C (Club G), is the period between 1 February 2010 and 20 December 2010, and between 1 January 2011 and 31 December 2012, i.e. the end of the season of the player s 21 st birthday. 22. Consequently, and taking into account the aforementioned considerations, the Chamber partially accepted Club A s claim and pointed out that Club C (Club G) is liable to pay training compensation to Club A in the amount of EUR 175,000, corresponding to 11 months of the season of his 19 th birthday as well as the entire seasons of his 20 th and 21 st birthdays. 23. Moreover, taking into consideration Club A s claim as well as art. 3 par. 2 of Annexe 4 of the Regulations, the Chamber decided that, in conformity with its longstanding practice, Club C (Club G) has to pay interest of 5% p.a. over the amount payable as training compensation as of the 31 st day of the registration of the player with Club C (Club G), i.e. as of 17 August 2014, until the date of effective payment. 24. Lastly, the Chamber 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 DRC relating to disputes regarding training compensation costs in the maximum amount of CHF 25,000 are levied. It is further stipulated that the costs are to be borne in consideration of the parties degree of success in the proceedings and that, in accordance with Annex A of the Procedural Rules, the costs of the proceedings are to be levied on the basis of the amount in dispute. 7/9
8 25. In respect of the above, the Chamber held that the amount to be taken into consideration in the present proceedings is EUR 180,000 related to the claim of Club A. Consequently, the Chamber concluded that the maximum amount of costs of the proceedings corresponds to CHF 25,000 (cf. table in Annex A). 26. As a result, and taking into account the particularities of the present matter, the number of issues that had to be addressed, the complexity of the case as well as that the claim of Club A has been accepted to a great extent, the Chamber determined the costs of the current proceedings to the amount of CHF 18,000, which shall be borne by Club C (Club G) to cover the costs of the present proceedings. Thereof the amount of CHF 14,000 has to be paid by Club C (Club G) to FIFA and the amount of CHF 4,000 to Club A. 27. The Chamber concluded its deliberations by rejecting any further claim lodged by Club A. III. Decision of the Dispute Resolution Chamber 1. The claim of the Claimant, Club A, is partially accepted. 2. The Respondent, Club C, has to pay to the Claimant, within 30 days as from the date of notification of this decision, the amount of EUR 175,000 plus interest at 5% p.a. as of 17 August 2014 until the date of effective payment. 3. In the event that 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 claim lodged by the Claimant is rejected. 5. The final costs of the proceedings in the amount of CHF 18,000 are to be paid by the Respondent within 30 days as from the date of notification of the present decision as follows: 5.1 The amount of CHF 14,000 has to be paid to FIFA to the following bank account with reference to case no. XXXX: UBS Zurich Account number U (FIFA Players Status) Clearing number 230 8/9
9 IBAN: CH U SWIFT: UBSWCHZH80A 5.2 The amount of CHF 4,000 has to be paid to the Claimant. 6. The Claimant is directed to inform the Respondent 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 Dispute Resolution Chamber of every payment received. ***** 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 Lausanne Switzerland Tel: / Fax: info@tas-cas.org / For the Dispute Resolution Chamber: Marco Villiger Deputy Secretary General Encl. CAS directives 9/9
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