Labour Disputes
Texto da decisão
Decision of the
Dispute Resolution Chamber
passed on 4 August 2022
regarding an employment-related dispute concerning the player B
BY:
Omar Ongaro (Italy), Deputy Chairperson
Laurel Vaurasi (Fiji), member
Khadija Timera (Senegal), member
CLAIMANT:
Club A, Country A
Represented by
RESPONDENT 1:
Player B, Country B
Represented by
RESPONDENT 2:
Club C, Country C
Represented by
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I. Facts of the case
1.
On 14 November 2020, the country A club, A and the country B player, B allegedly signed
an employment contract (hereinafter: the First Contract) valid as from 1 January 2021 until
31 December 2021.
2.
In accordance with Clause 2.1. of the First Contract, A undertook to pay to B inter alia a
monthly remuneration of USD 18,350 for the duration of the First Contract.
3.
Furthermore, in accordance with Clause 2.4 of the First Contract, A and B agreed as
follows: “The contract will be automaticely cancel without any compensation if the player failed
for the medical check up or is unable to play for any reason at the 01 january 2021.”
4.
Moreover, in accordance with Clause 11 of the First Contract, A and B agreed as follows:
“(…) In the event that the participation has been terminated by the Club or the player prior to
the expiry of the contract for any cause other than those provided in Clause 6 and 7 above, the
party who cancel the contract will be entitled to pay a compensation equivalent to 3 (three)
months salary maximum as full and final settlement of the playing contract (salary).”
5.
On 19 December 2020, B arrived in Country A following the issuance of a provisional work
permit
and
entered
quarantine
in
a
hotel
until
3 January 2021, in line with local COVID-19 regulations at the time.
6.
By correspondence dated 23 December 2020, B received an offer (hereinafter: the Offer)
from the Country C club, C, for an employment contract valid as from 2 February 2021
until 1 January 2022.
7.
Aware of the Offer which B had received, between the dates of 3 January 2021 and 5
January 2021, A attempted to convince the former in several face-to-face meetings to
honour his obligations under the First Contract.
8.
By correspondence dated 5 January 2021, A sent a letter to C in which it informed the
latter that B had signed a contract with itself and that it would bring a claim before FIFA if
C did not withdraw its Offer.
9.
By correspondence dated 5 January 2021, B sent a letter to A in which he stated that he
was not bound by the First Contract, as the negotiations had not yet been concluded and,
therefore, no valid and binding contract had been signed.
10. On 28 April 2021, B and C signed an employment contract (hereinafter: the Second
Contract)
valid
as
from
2
February
2021
until
1 January 2022.
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11. In accordance with the Second Contract, C undertook to pay B, inter alia, an overall salary
of USD 450,000.
II. Proceedings before FIFA
12. On 13 April 2022, A filed the claim at hand before FIFA. A brief summary of the position of
the parties is detailed in continuation.
a. Position of the Claimant
13. According to A, B breached the First Contract in line with art. 14 of the Regulations on the
Status and Transfer of Players by refuting its validity and subsequently signing the Second
Contract.
14. A requested that B is held liable to pay compensation in the amount of the entire First
Contract, i.e. USD 220,200.
15. Furthermore, A argued that C is also liable to pay compensation by signing a player who
was in breach of his contract without just cause, and therefore inducing said breach, in
accordance with art. 17 par. 4 of the Regulations on the Status and Transfer of Players.
16. A, therefore, requested that C also be held liable, jointly and severally, to pay
compensation for breach of contract and additional compensation in the amount of USD
220,200.
17. Moreover, A also requested complimentary compensation from C only, for having to
replace B and having allegedly suffered prejudice to its image in the amount of USD
160,000.
18. A requested interest of 5% p.a. on all
13 April 2022 until the date of effective payment.
amounts
claimed
as
from
19. Lastly, A requested the imposition of sporting sanctions on C.
b. Position of the Respondents
20. B and C (hereinafter jointly: the Respondents) issued a joint statement of defence.
21. According to the Respondents, the First Contract was merely a “simulation” for the
purposes of obtaining a permanent work permit, and since the duration of said work
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permit was shorter than the duration of the First Contract, the latter is automatically
invalid.
22. Furthermore, the Respondents submitted that the First Contract had been amended after
the permanent visa had been issued, thereby invalidating the First Contract, if it had been
valid to begin with.
23. Additionally, the Respondents argued that A withheld the passport of B during the
statutorily mandated COVID-19 quarantine, which constituted bad faith and grounds to
terminate the First Contract prematurely, should it have been considered valid.
24. Moreover, the Respondents relied on clause 2.4 of the First Contract in arguing that B had
not
attended
training
by
the
stipulated
date
of
3 January 2021 due to the quarantine mandated by local COVID-19 regulations. In line
with the principle of pacta sunt servanda, therefore, it was argued that the First Contract
was automatically terminated after 3 January 2021.
25. As a subsidiary request, the Respondents submitted that, by virtue of Clause 11 of the
First Contract, the compensation payable to A should be limited to three monthly salaries.
26. Furthermore, C specifically asserted that, because the transfer of B had not been entered
into TMS at the time the latter was approached, and A failed to request an ITC from the
member association to which his previous club was affiliated, it should not be held jointly
and severally liable to pay compensation for B’s potential breach of contract.
27. Lastly, the Respondents submitted that, since A failed to submit any evidence with
regards to the cost of replacing B, the former should not be entitled to receive
compensation within this context.
c. Position of the Claimant / Replica
28. To begin with, A submitted that a contract is necessary by law in order to obtain a work
permit / visa under Country A law. In this respect, it outlined the standard procedure for
obtaining a visa in Country A, which entails that a preliminary visa of
3 months is granted in order for the employee (i.e., B) to enter Country A and begin
working subject to a probation period. Once the employee is established in Country A,
this preliminary visa is extended to the date of expiration of the employment contract. As
such, A argued that the fact that the visa itself did not have the same duration as the First
Contract does not invalidate the latter.
29. A also submitted that following B’s quarantine, the former received confirmation that the
Country A Premier League would reorganise its schedule in order to be in line with the
European transfer market, and that, subsequently, the undated offer of a new contract
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which the Respondents claim represents a standalone agreement, is merely an extension
of the already valid First Contract, with adjusted dates to reflect the fact that the duration
of the said contract would, in practice, be cut short by this organizational change.
30. In this respect, A pointed out that B’s agent sent a letter to the sporting director of A,
asking that for this offer / contract extension, a particular template shall be used when A
would draft it. The latter therefore argued that, not only was the First Contract validly and
bindingly signed by B, but, through his agent, he was also in the process of agreeing an
extension thereof, and that subsequently denying the validity of either agreement
represents B’s bad faith.
31. Furthermore, A rejected the argument that the First Contract was invalid because B failed
to attend his medical check-up or training due to being in quarantine, as this makes the
performance of the First Contract automatically impossible given the fact that the Country
A COVID-19 protocols at the time were mandatory. Beyond this, it was submitted that it
is well-established DRC jurisprudence that the validity of a contract may not be subject to
a medical examination. As such, the Claimant argued that the First Contract should be
considered valid and binding.
32. Moreover, A outlined that C may not rely on the argumentation that no ITC was requested
in order to escape liability for inducing B’s breach of contract. In this respect, it equally
contested the fact that the later date of signature of the Second Contract affected the
joint and several liability of C in any way.
33. With regards to the detention of B’s passport, A stressed that this was only for the
purposes of obtaining a permanent work permit during the period in which the former
was quarantined. A also outlined that it returned his passport immediately after he left
quarantine.
34. Furthermore, A outlines that the liquidated damages provision under Clause 11 of the
First Contract should not apply on account of the fact that such clauses, under the
application of Country A law are conditional on the “good faith performance” of the
respective employment contract. Subsidiarily, if it should be deemed as applicable, it
should apply to both Respondents, on account of the inducement of breach by C.
35. Lastly, A amended its claim to the effect that, if Clause 11 shall apply and the liquidated
damages stipulated thereunder shall be deemed as the maximum compensation payable
to A, in line with Country A labour law, an additional USD 6,000 shall be payable as
indemnity for the accommodation expenses for B during the mandatory quarantine
period.
d. Position of the Respondents / Duplica
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36. The Respondents rejected all submissions presented by A in the replica of the latter,
arguing as follows:
37. The Respondents conceded that the draft for an extension of the First Contract was drawn
up by the agent of B, however, it was argued that this only further substantiates that the
First Contract was, in fact, only a simulation for the purposes of obtaining a work permit.
38. Furthermore, the Respondents reiterated that, in line with the principle of pacta sunt
servanda, the termination clause under Clause 2.4 of the First Contract should be upheld,
and that, as a result, there should be no termination without just cause by B, and no
inducement in this respect by C.
39. Moreover, the Respondents submitted that, should the liquidated damages provision
under Clause 11 of the First Contract be upheld, it should not apply subject to a probation
period as stipulated in Country A labour law, but under the traditional application of the
FIFA Regulations on the Status and Transfer of Players.
40. Lastly, the Respondents reasserted that no evidence had been submitted by A with
regards to demonstrating any costs incurred by having to replace B, or any damage
suffered to its image.
III. Considerations of the Dispute Resolution Chamber
a. Competence and applicable legal framework
41. First of all, the Dispute Resolution Chamber (hereinafter also referred to as Chamber or
DRC) analysed whether it was competent to deal with the case at hand. In this respect, it
took note that the present matter was presented to FIFA on 13 April 2022 and submitted
for decision on 4 August 2022. Taking into account the wording of art. 34 of the July 2022
edition of the Procedural Rules Governing the Football Tribunal (hereinafter: the
Procedural Rules), the aforementioned edition of the Procedural Rules is applicable to the
matter at hand.
42. Subsequently, the members of the Chamber referred to art. 2 par. 1 of the Procedural
Rules and observed that in accordance with art. 23 par. 1 in combination with art. 22
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lit. b) of the Regulations on the Status and Transfer of Players (July 2022 edition), the
Dispute Resolution Chamber is competent to deal with the matter at stake, which
concerns an employment-related dispute with an international dimension between a
Country B player, a Country A club and a Country C club.
43. 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 Players (July 2022 edition),
and considering that the present claim was lodged on 13 April 2022, the March 2022
edition of said regulations (hereinafter: the Regulations) is applicable to the matter at hand
as to the substance.
b. Burden of proof
44. The Chamber recalled the basic principle of burden of proof, as stipulated in art. 13
par. 5 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 Chamber stressed
the wording of art. 13 par. 4 of the Procedural Rules, pursuant to which it may consider
evidence not filed by the parties, including without limitation the evidence generated by
or within the Transfer Matching System (TMS).
c. Merits of the dispute
45. Its competence and the applicable regulations having been established, the Chamber
entered into the merits of the dispute. In this respect, the Chamber started by
acknowledging all the above-mentioned facts as well as the arguments and the
documentation on file. 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.
i. Main legal discussion and considerations
46. The foregoing having been established, the Chamber moved to the substance of the
matter, and took note of the fact that the parties strongly dispute the validity of the First
Contract and the existence of obligations thereunder.
47. In this respect, the Chamber started by recalling its well-established jurisprudence which
dictates that, in order for an employment contract to be considered as valid and binding,
apart from the signature of both the employer and the employee, it should contain the
essentialia negotii of an employment contract, such as the parties to the contract and their
role, the duration of the employment relationship and the remuneration payable by the
employer to the employee.
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48. In casu, after a thorough analysis of the documentation on file, the Chamber concluded
that all such elements were included in the First Contract. In other words, the Chamber
understood that the legal document concluded by A and B (i.e. the First Contract) indeed
included all the relevant information at the basis of an employment relationship between
contractual parties. Specifically, the document provides for the duration of the
employment relationship and the remuneration payable to B. Moreover, it clearly
stipulates that the latter is employed as a footballer with A.
49. Furthermore, with regards to establishing the mutual intention of creating binding legal
relations, the Chamber noted that the First Contact contained the signature of both A and
B. In respect of the assertion that the First Contract appears to be simply a simulation for
the purposes of obtaining a work permit, the Chamber recalled its longstanding
jurisprudence,
as
well
as
art.
18
par. 4 of the Regulations, which both stipulate that the validity of an employment contract
may not be made subject to the passing of a medical examination or the obtaining of a
work permit. In any case, the Chamber wished to reiterate that, at the time the First
Contract was signed, there appeared to be a mutual intention to enter into a contractual
relationship.
50. Additionally, the Chamber took note of the line of argument submitted by the
Respondents that the draft of the First Contract which had been communicated to B by A
at an unspecified date differed substantially from the original version of the First Contract
and that, as a result, the First Contract should be held invalid.
51. In this respect, the Chamber analysed said draft and established that, not only was it
identical with regards to all essentialia negotii, with the exception of the contractual term,
but that this change was also justified with the change in schedule implemented by the
Country A Premier League, which the Respondents did not contest.
52. Thus, the Chamber concluded that the First Contract is in fact a valid and binding
employment contract and shall be considered in the case at stake, as the contractual basis
of the present dispute.
53. The foregoing having been established, the Chamber moved to the substance of the
matter and first took note of the allegation that B terminated the First Contract as a result
of having been approached by C with a more lucrative offer.
54. In this respect, the Chamber deemed it important to analyse the provision under Clause
2.4 of the First Contract, which allegedly permitted the termination of the First Contract
with just cause in case B failed to attend training or pass his medical examination for any
reason.
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55. In this context, the Chamber first reminded the parties of the clear and explicit wording
of art. 18 par. 4 of the Regulations, according to which the validity of an employment
contract cannot be made subject to a successful medical examination and/or the grant of
a work permit. Referring also to the obligation of the parties to maintain contractual
stability, the Chamber underlined that a club willing to engage a specific player should
perform any medical examination prior to concluding any employment contract with the
player. Any contractual provision contrary to art. 18 par. 4 of the Regulations shall be
considered as invalid.
56. Moreover, the Chamber wished to point out that the part of Clause 2.4 which allegedly
permitted the termination with just cause of the First Contract if B failed to attend training
on 1 January 2022 rendered the performance of the First Contract impossible, given the
fact that B was obligated by the mandatory COVID-19 regulations to quarantine beyond
the stipulated deadline. Therefore, the provision was deemed invalid.
57. Turning to the allegation that A withheld B’s passport, constituting just cause to terminate
the First Contract, the Chamber took note of the argumentation submitted by A that it
only withheld the passport during B’s quarantine in order to procure a new work permit,
and that said passport was returned following the end of the aforementioned quarantine.
Thus, the Chamber concluded that this did not constitute just cause to terminate the First
Contract.
58. Bearing in mind the foregoing, the Chamber concluded that the First Contract was
terminated by B without just cause.
59. In terms of the application of the provision contained in Clause 11 of the First Contract,
the Chamber took note of the wording of said provision once again, which established
that “In the event that the participation has been terminated by the Club or the player prior to
the expiry of the contract for any cause other than those provided in Clause 6 and 7 above, the
party who cancel the contract will be entitled to pay a compensation equivalent to 3 (three)
months salary maximum as full and final settlement of the playing contract (salary).”
60. As a preliminary remark, the Chamber wished to recall that the First Contract and
proceedings at hand are assessed in accordance with the FIFA Regulations and not the
law of Country A and that, as such, the provisions allegedly laid down in the Country A
Labour Protection Act shall not apply.
61. After analysing the content of the aforementioned clause, the Chamber concluded that it
fulfilled the criteria of reciprocity and proportionality, in line with the Chamber’s
longstanding jurisprudence and therefore was to be applied in the case at hand to
determine the amount of compensation payable to A.
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62. Lastly, the Chamber considered the liability of C as a result of the unlawful breach
committed by B.
63. In this respect, the Chamber recalled the wording of art. 17 par. 4, in accordance with
which it shall be presumed that, unless established to the contrary, any club signing a
professional player who has terminated his previous contract without just cause has
induce that professional to commit a breach. Consequently, the Chamber pointed out
that the party that is presumed to have induced the player to commit a breach carries the
burden of proof to demonstrate the contrary.
64. In this respect, the Chamber stressed that the argument submitted by C that A had not
requested an ITC was not sufficient to discharge the presumption that the
aforementioned breach had not been induced, particularly since A had informed C in
writing of the existence of the First Contract between itself and B. Moreover, the Chamber
outlined that the delayed signature of the Second Contract did not affect the fact that,
were
it
not
for
the
Offer
made
to
B
by
C
on
23 December 2020, the former would likely not have terminated the First Contract.
65. Thus, the Chamber highlighted that C was not able to present enough evidence as to
reverse the respective presumption contained and is, therefore, to be considered as
having induced B to commit a breach of contract.
ii. Consequences
66. Having stated the above, the members of the Chamber turned their attention to the
question of the consequences of such unjustified breach of contract committed by B. In
doing so, the Chamber firstly recapitulated that, in accordance with art. 17 par. 1 of the
Regulations, the amount of compensation shall be calculated, in particular and unless
otherwise provided for in the contract at the basis of the dispute, with due consideration
for the law of the country concerned, the specificity of sport and further objective criteria,
including in particular, the remuneration and other benefits due to the player under the
existing contract and/or the new contract, the time remaining on the existing contract up
to a maximum of five years, the fees and expenses paid or incurred by the former club
(amortised over the term of the contract) and depending on whether the contractual
breach falls within the protected period.
67. In application of the relevant provision, the Chamber held that it first of all had to clarify
as to whether the First Contract contained a provision by means of which an amount of
compensation payable by either A or B in the event of breach of contract had been agreed
upon beforehand.
68. In this regard, the Chamber recalled that Clause 11 of the First Contract fulfilled the
criteria of the reciprocity and proportionality, in line with the Chamber’s longstanding
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jurisprudence, and was to be applied to the case at hand to determine the amount of
compensation payable by the Respondents to A.
69. Furthermore, the Chamber took note of A’s request that it should be reimbursed for the
cost of having to replace B and for having suffered prejudice as a result of the contractual
breach. In this respect, the Chamber established that A failed to provide sufficient
evidence of the specific amount incurred for having had to replace B, as well as having
suffered any prejudice to its image. Thus, failing the requisite burden of proving the
alleged expenses in this respect, the Chamber held that such request submitted by A shall
be rejected.
70. Consequently, the Chamber decided that the amount of USD 55,050, i.e. three monthly
salaries of USD 18,350, in accordance with Clause 11 of the First Contract, is due to A by
the Respondents.
71. Taking into consideration A’s request, as well as the constant practice of the Chamber in
this regard, the latter decided to award A interest on said compensation at the rate of 5%
p.a. as of 13 April 2022 until the date of effective payment.
iii. Art. 17 par. 3 and 4 of the Regulations
72. In continuation, the Chamber focused on the further consequences of the breach of
contract in question and, in this respect, it addressed the question of sporting sanctions
against B in accordance with art. 17 par. 3 of the Regulations. The cited provision
stipulates that, in addition to the obligation to pay compensation, sporting sanctions shall
be imposed on any player found to be in breach of contract during the protected period.
73. In this respect, the Chamber referred to item 7 of the “Definitions” section of the
Regulations, which stipulates, inter alia, that the protected period shall last “for three entire
seasons or three years, whichever comes first, following the entry into force of a contract,
where such contract is concluded prior to the 28th birthday of the professional, or two entire
seasons or two years, whichever comes first, following the entry into force of a contract, where
such contract is concluded after the 28th birthday of the professional.”
74. In
this
respect,
the
Chamber
took
note
that
B
was
born
on
XX XX XXXX and the First Contract was concluded on 14 November 2020. Furthermore,
the Chamber noted that B terminated the contract without just cause on 5 January 2021,
when he informed A that he does not recognise the validity of the First Contract. The
breach of contract by B had therefore occurred within the protected period.
Consequently, the Chamber decided that, by virtue of art. 17 par. 3 of the Regulations, B
had to be sanctioned with a restriction of four months on his eligibility to participate in
official matches.
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75. Subsequently, the Chamber recalled that, in accordance with art. 17 par. 4 of the
Regulations, it shall be presumed, unless established to the contrary, that any club signing
a professional player who has terminated his previous contract without just cause has
induced that professional to commit a breach. Consequently, the Chamber pointed out
that the party that is presumed to have induced the player to commit a breach carries the
burden of proof to demonstrate the contrary. In this respect, the Chamber recalled that
C was not able to present enough evidence as to reverse the respective presumption
contained and is, therefore, to be considered as having induced B to commit a breach of
contract.
76. Consequently, the Chamber decided that, by virtue of art. 17 par. 4 of the Regulations, C
shall be banned from registering any new players, either nationally or internationally, for
the two next entire and consecutive registration periods following the notification of the
present decision.
iv. Conclusion
77. As a result of the aforementioned, the Chamber decided to partially accept the claim of A
and to order B and C to, jointly and severally, pay to the former the amount of USD 55,050
as compensation plus 5% interest p.a. as from 13 April 2022 until the date of effective
payment.
78. A restriction of four months on his eligibility to play in official matches is imposed on B.
This sanction applies with immediate effect as of the date of notification of the present
decision. The sporting sanctions shall remain suspended in the period between the last
official match of the season and the first official match of the season, in both cases
including national cups and international championships for clubs.
79. C shall be banned from registering any new players, either nationally or internationally,
for the two next entire and consecutive registration periods following the notification of
the present decision.
80. Finally, and given that sporting sanctions have been imposed on both Respondents, the
Chamber concluded that art. 24 of the Regulations shall not apply in this case.
d. Costs
81. The Chamber referred to art. 25 par. 1 of the Procedural Rules, according to which
“Procedures are free of charge where at least one of the parties is a player, coach, football
Page 13
agent, or match agent”. Accordingly, the Chamber decided that no procedural costs were
to be imposed on the parties.
82. Likewise and for the sake of completeness, the Chamber recalled the contents of art. 25
par. 8 of the Procedural Rules, and decided that no procedural compensation shall be
awarded in these proceedings.
83. Lastly, the DRC concluded its deliberations by rejecting any other requests for relief made
by any of the parties.
IV. Decision of the Dispute Resolution Chamber
1.
The claim of the Claimant, A, is partially accepted.
2.
Respondent 1, B, has to pay to the Claimant USD 55,050 as compensation for breach of
contract without just cause plus interest of 5% p.a. as from 13 April 2022 until the date of
effective payment.
3.
Respondent 2, C, is jointly and severally liable for the payment of the aforementioned
amount.
4.
Any further claims of the Claimant are rejected.
5.
Full payment (including all applicable interest) shall be made to the bank account
indicated in the enclosed Bank Account Registration Form within 30 days of notification
of this decision.
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6.
Respondent 1 and Respondent 2 shall provide evidence of payment of the due amount in
accordance with point 3. to FIFA via the e-mail address [email protected] duly translated
into one of the official FIFA languages (English, French, or Spanish).
7.
A restriction of four months on his eligibility to play in official matches is imposed on
Respondent 1, B. This sanction applies with immediate effect as of the date of notification
of the present decision. The sporting sanctions shall remain suspended in the period
between the last official match of the season and the first official match of the next
season, in both cases including national cups and international championships for clubs.
8.
Respondent 2, C, shall be banned from registering any new players, either nationally or
internationally, for the two next entire and consecutive registration periods following the
notification of the present decision.
9.
If the aforementioned sum plus interest is not paid within 30 days of notification of this
decision, the present matter shall be submitted, upon request of the Claimant, to the FIFA
Disciplinary Committee for its consideration and a formal decision.
10. This decision is rendered without costs.
For the Football Tribunal:
Emilio García Silvero
Chief Legal & Compliance Officer
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NOTE RELATED TO THE APPEAL PROCEDURE:
According to article 57 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 17 of the Procedural Rules).
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