DRC Overdue Payables
Texto da decisão
REF. FPSD-14627
Decision of the
Dispute Resolution Chamber
passed on 18 September 2024
regarding an employment-related dispute concerning the player Besart
Abdurahimi
BY:
Sihon GAUCI (Malta)
CLAIMANT:
Besart Abdurahimi, Croatia
Represented by Hrvoje Raic
RESPONDENT:
Apollon Limassol, Cyprus
Represented by Alkis Papantoniou
pg. 2
REF. FPSD-14627
I. Facts of the case
1. On 9 June 2023, the Croatian player Besart Abdurahimi (hereinafter the “Claimant” or
“Player”) and the Cypriot club Apollon Limassol (hereinafter the “Respondent” or “Club”)
concluded an employment agreement (hereinafter the “Employment Agreement”), valid as
from 9 June 2023 until 30 June 2024.
2. In the Employment Agreement, the Respondent undertook, inter alia, to pay the Claimant a
monthly net salary of EUR 9,000.
3. On the same day, the parties concluded a supplementary agreement (hereinafter
“Supplementary Agreement”), wherein the Respondent undertook to pay the Claimant, inter
alia, as follows:
-
EUR 115,000 net as additional salary for season 2023-2024 (payable together with the
monthly salary defined in the Employment Agreement) in 10 equal instalments of EUR
11,500 from 31 August 2023 until 31 May 2024;
-
EUR 105,000 net as additional salary for season 2024-2025 (payable together with the
monthly salary defined in the Employment Agreement) only in case the contract is
renewed based on paragraph 1.1 of the Employment Agreement, in 10 equal
instalments of EUR 10,500 net payable from 31 August 2024 until 31 May 2025; and
-
EUR 15,000 net per season for allowances (apartment) in 10 equal instalments of EUR
1,500 net from 31 August until 31 May of each season, along with the first flight ticket to
Cyprus summer 2023.
4. On 31 January 2024, the parties signed a Termination Agreement (hereinafter the
“Termination Agreement” in which the Respondent undertook to pay the Claimant as follows:
Net EUR 43,807.50 in 5 instalments, as follows:
- EUR 8,761.50 payable 29 February 2024
- EUR 8,761.50 payable 31 March 2024
- EUR 8,761.50 payable 30 April 2024
- EUR 8,761.50 payable 31 May 2024
- EUR 8,761.50 payable 30 June 2024
5. The Termination Agreement further provided the following:
“3. The Club undertakes to pay all taxes, state levies and other contributions due on top and
above the aforementioned net sums.
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REF. FPSD-14627
4. The Club undertakes to provide to the Player evidence and/or confirmation that all relevant
taxes, state levies and contributions on top and above the aforementioned net sums have been
paid by the Club, all within the same deadlines as specified above.
5. In case of delay of 7 days in payment of any instalment of the sums specified in the of the
sums specified in the article 2. herein to the Player by the Club, all the remaining unpaid
instalments shall immediately fall due, and in such case the Club shall pay to the Player, in
addition to the sums specified in the article 2. herein, a default interest of 10% per year.”
6. On 31 January 2024, i.e. the same day as the signing of the Termination Agreement, the
parties signed an Annex to the Termination Agreement (hereinafter, the “Annex”). In the
Annex, the parties agreed as follows:
“B. In consideration of the termination of the employment contract and in addition to all the
sums agreed in the Termination Agreement, the Club shall also pay to the Player additional
amount of compensation of EUR 77,500 net” payable in 6 instalments:
-
EUR 11,500 payable on 29 February 2024
EUR 11,500 payable on 31 March 2024
EUR 11,500 payable on 30 April 2024
EUR 11,500 payable on 31 May 2024
EUR 11,500 payable on 30 June 2024
EUR 20,000 payable on 31 July 2024
“C. The Club undertakes to pay all taxes, state levies and other contributions due on top and
above the aforementioned net sums.
D. The Club undertakes to provide to the Player evidence and/or confirmation that all relevant
taxes, state levies and contributions on top and above the aforementioned net sums have been
paid by the Club, all within the same deadlines as specified above.
E. In case of delay of 7 days in payment of any instalment of the sums specified in the of the sums
specified in the article B. herein to the Player by the Club, all the remaining unpaid instalments
shall immediately fall due, and in such case the Club shall pay to the Player, in addition to the
sums specified in the article 2. herein, a default interest of 10% per year.
F. Both parties agree and acknowledge that this agreement along with the “Termination
Agreement” constitutes the entire agreement between the parties and that any other agreements
with regard to the employment of the Player, his remuneration or similar issues are hereby
superseded.”
7. The Respondent failed to pay the Player the first instalments of both the Termination
Agreement and the Annex (hereinafter collectively referred to as the “Termination Contracts”)
of net EUR 8,761.50 and EUR 11,500 respectively, which both fell due on 29 February 2024.
pg. 4
REF. FPSD-14627
8. On 12 April 2024 the Claimant sent a notice of default to the Respondent, requesting the
payment of a net total of EUR 121,307.50, broken down into EUR 20,261.50 which matured
on 29 February 2024, and EUR 101,046 which matured on 8 March 2024, as well as the taxes,
state contributions, and surcharges on top of the net amounts.
9. In the default notice, the Claimant gave the Respondent 10 days to cure the default and to
provide to the Claimant the requested information regarding taxes and contributions
within the deadline before it would file a claim before the FIFA Football Tribunal.
10. The Respondent replied on 30 April 2024, asking for time to arrange for the payments the
following week and requesting the Claimant to delay legal action.
II. Proceedings before FIFA
11. On 14 May 2024, the Claimant filed the claim at hand before FIFA. A summary of the parties’
position is set out below.
a. Position of the Claimant
12. According to the Claimant, the Respondent failed to pay the first instalment, violating both
art. 12bis of the Regulations on the Status and Transfer of Players (hereinafter: the
Regulations), as well as the acceleration clauses of the Termination Contracts.
13. The Claimant requested the following relief:
I.
to condemn the Respondent to pay in favor of the Claimant overdue payables in net total
of EUR 121,307.50 (one hundred twenty-one thousand, three hundred and seven euros
and fifty cents) which matured as follows:
- net EUR 20,261,50 on 29/2/2024, and
- net EUR 101,046.00 on 8/3/2024,
within 45 days as from the date of notification of the decision in the matter of the
reference to the Respondent; and
II.
to condemn the Respondent to pay all relevant taxes, state contributions and surcharges,
on top of the above-mentioned net amounts, within 45 days as from the date of
notification of the decision in the matter of the reference to the Respondent;
or alternatively
to condemn the Respondent to provide the Claimant with the corresponding tax
certificates concerning the payment of all the above specified net amounts alongside all
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REF. FPSD-14627
the net amounts already paid to the Claimant during the term of the Employment
contract, within 45 days as from the date of notification of the decision in the matter of
the reference to the Respondent; and
III.
to condemn the Respondent to pay in favor of the Claimant default interest of 10% per
year on the aforementioned amounts starting from the respective date of maturity until
the effective date of the payment, within 45 days as from the date of notification of the
decision in the matter of the reference to the Respondent.
IV.
to impose sporting sanctions against the Respondent, all in the light of FIFA RSTP.
b. Position of the Respondent
14. According to the Respondent, (i) the damages ought to be mitigated by deducting the
Claimant’s salaries earned with a new Club following the termination; (ii) the penalties
requested were disproportionate, excessive, and unreasonable; (iii) the request for tax
payments and tax certificates were ungrounded and lacked the necessary precision, and
further, the Claimant did not raise a dispute concerning tax obligations; and, (iv) the
requirements for 12bis sanctions have not been met.
Mitigated Damages
15. The Respondent claimed that because the payments in the Termination Contracts
constituted consideration for the early termination of the Employment Agreement, the
compensation now due under the Termination Contracts should be subject to the same
mitigation principles as the compensation for breach under art. 17.
16. The Respondent further argued that due to the Player having reportedly signed elsewhere,
the Club expects his damages to be far less than the EUR 121,307.50 claimed.
17. Furthermore, the Respondent stated that because entering into a mutual termination
agreement (as opposed to a club merely unilaterally terminating a contract) was more
beneficial for players seeking new employment opportunities, the Respondent should not
face more severe consequences than if the contract were unilaterally terminated.
18. The Respondent concluded that any compensation owed to the Claimant should therefore
be mitigated by the payments the Claimant was to receive under its new contract until 30
June 2024.
Excessive Penalty Clause
19. With regard to the validity of the acceleration clause, the Respondent argued that clause
constituted a contractual penalty, which imposed payments not due at the time and served
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REF. FPSD-14627
as a deterrent to the Club from breaching the Termination Contracts by imposing additional
financial obligations on the Club.
20. According to the Respondent, this contractual penalty including the remaining payments
falling due and the 10% p.a. interest, was disproportionate, excessive and unreasonable, as
it was 500% higher than the amount that triggered the acceleration clause and out of line
with the amounts typically accepted by the CAS, which it stated to be approximately 50% of
the total due amount.
21. The Respondent further submitted that it was not in danger of bankruptcy or liquidation
proceedings and therefore the delay of payment to the Claimant would not have a
jeopardizing effect.
22. Moreover, the Respondent argued that the financial harm to the Claimant was not
significant enough to impose such harsh contractual penalties.
23. Furthermore, the Respondent asserted that the 10% per annum interest was substantially
higher than the default interest established by Swiss law and the long-standing
jurisprudence of the FIFA Football Tribunal.
24. The Respondent therefore requested that the interest payment be rejected entirely or
adapted to 5%.
Request for Tax Payment and Tax Certificates
25. The Respondent argued that the Claimant’s request for proof of tax payments and tax
certificates for all requested amounts were ungrounded, lacked the necessary precision.
26. The Respondent continued that, to its awareness, no tax amount had been paid by the
Claimant in relation to his employment contracts.
Sanctions pursuant to art. 12bis of the Regulations
27. The Respondent argued that the dispute did not concern an employment contract or
transfer contract; and that therefore, the Respondent did not owe overdue payables, and
consequently art. 12bis of the Regulations did not apply.
28. Furthermore, the Respondent argued that the Claimant did not follow the procedural
requirements under art. 12bis, for the following reasons:
-
The Respondent provided explanations for the existence of overdue payables
towards the Player;
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REF. FPSD-14627
-
The overdue payables were only in the amount of EUR 20,261.50, not for the entire
amount the Player claimed;
-
There would be significant financial consequences for the Club if the claim were
granted; and,
-
The circumstances of the case at hand do not justify the imposition of disciplinary
sanctions.
29. The requests for relief of the Respondent were the following:
“1. Primary Requests
1. To reject the Claim of the Claimant for the payment of the total amount of EUR 121,307.50;
2. To request by the FIFA Player Status Department and/or the FIFA General Secretariat and
the Claimant to produce the contract signed between the Claimant and Club Zrinjski Mostar,
in order to be aware of the exact amount of damages mitigated by the Claimant after the
termination of the employment relationship;
3. To provide us with the capacity to supplement our present Response, after we receive the
contract of the Claimant with the New Club, by stating the exact amount that we request to
be deducted from the compensation requested by the Claimant;
4. To determine that the amount requested by the Claimant through his claim shall be
mitigated by the payments he is to receive by the New Club for the period corresponding to
the remaining term of the terminated contract with the Club (i.e. from the date of signature
of the contract with the New Club until 30.06.2024).
2. Subsidiary Requests
In case Your Chamber finds that the total amount requested by the Claimant through his
claim shall not be mitigated, or in the event that Your Chamber finds that the accelerated
debt of EUR 101,046 shall not be mitigated:
1. To reject the Claim of the Claimant for the payment of the amount of EUR 101,046 as a
penalty of acceleration of debt, because it is an excessive and unreasonable penalty.
2. To determine that the penalty of EUR 101,046 shall not be paid to the Claimant at all.
Subsidiarily, to adapt the said amount of penalty in order to be reasonable and
proportionate to the circumstances of the case at hand.
3. To reject the claim of the Claimant for the payment of a 10% interest p.a. on the requested
amount.
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REF. FPSD-14627
4. To determine that any interest rate shall apply only on the overdue amount of EUR
20,261.50
5. To reject the claim of the Claimant regarding the taxes and the tax certificates.
6. To reject the claim of the Claimant for the imposition of disciplinary sanctions on the basis
of art. 12bis FIFA RSTP.”
pg. 9
REF. FPSD-14627
III. Considerations of the Dispute Resolution Chamber
a. Competence and applicable legal framework
30. First of all, the Single Judge of the Dispute Resolution Chamber (hereinafter: the Single Judge)
analysed whether she was competent to deal with the case at hand. In this respect, she took
note that the present matter was presented to FIFA on 14 May 2024 and submitted for
decision on 18 September 2024. Taking into account the wording of art. 34 of the March
2023 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.
31. Furthermore, the Single Judge 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 par. 1 lit. b) of the
Regulations (June 2024 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 an Croatian player and a Cypriot club.
32. Subsequently, the Single Judge analysed which regulations should be applicable as to the
substance of the matter. In this respect, she confirmed that, in accordance with art. 26 par.
1 and 2 of the Regulations (June 2024 edition), and considering that the present claim was
lodged on 14 May 2024, the February 2024 edition of the Regulations is applicable to the
matter at hand as to the substance.
b. Burden of proof
33. The Single Judge 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 Single Judge stressed
the wording of art. 13 par. 4 of the Procedural Rules, pursuant to which she 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
34. Having established the competence and the applicable regulations, 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 she will refer
only to the facts, arguments and documentary evidence, which she considered pertinent for
assessing the matter at hand.
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REF. FPSD-14627
i. Main legal discussion and considerations
35. The Single Judge then moved to the substance of the matter, and took note of the fact that
the parties strongly dispute whether the Respondent should pay the entire amount due
under the acceleration clause of the Termination Contracts.
36. In this context, the Single Judge acknowledged that it its task was to determine whether
principles of mitigation apply to the amounts claimed and whether the penalties were
excessive or unreasonable.
37. The Single Judge acknowledged that the Claimant established, and that the Respondent did
not dispute, two valid agreements existed between the parties, the Termination Contracts,
pursuant to which two payments fell due on 29 February 2024.
38. The Single Judge then noted that, pursuant to the acceleration clauses in the Termination
Contracts, in the event that the Respondent delayed payment for 7 days, the remaining
amounts would fall due and an additional interest of 10% per annum would be imposed.
39. Next, the Single Judge took note that the Respondent did not deny that the initial payment
structure or the acceleration clauses were agreed to by the parties, nor that it failed to make
the relevant payments by 8 March 2024; rather, the Respondent contested the
enforceability of the provisions, and argued that any damages awarded should be subject
to mitigation.
40. With respect to the request to mitigate, the Single Judge determined that mitigation
principles do not apply in the matter at hand, because – as correctly acknowledged by the
Respondent – the present matter is not a claim for compensation for breach of contract
under art. 17 of the Regulations, but rather one for overdue payables.
41. In the same vein, the Single Judge determined that, had the parties intended to mirror the
standard calculation of the compensation in accordance with art. 17 of the Regulations, they
should have done so in the Termination Contracts.
42. Moreover, the Single Judge found the acceleration clause to be proportionate and lawful.
The amounts of EUR 121,307.50 net that fell due upon the 7-day delay merely represented
the full value of the Termination Contracts. They did not constitute an additional lump sum
that would not already come due.
43. In continuation, the Single Judge found that the interest payment fell within the principle of
proportionality based on established jurisprudence which typically allows for up to 18% per
annum.
44. Thus, the Single Judge concluded that in accordance with the principle of pacta sunt
servanda, the Respondent failed to meet its financial obligations under the Termination
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REF. FPSD-14627
Contracts and owed outstanding remuneration, the remaining amounts that fell due under
the acceleration clause, and the interest.
ii. Consequences
45. Having stated the above, the Single Judge turned her attention to the question of the
consequences of the aforementioned failure by the Respondent to fulfil its financial
obligation.
46. The Single Judge observed that the outstanding remuneration which had fallen due on 29
February 2024 constituted EUR 20,261.50 net. Moreover, the Single Judge recalled that the
remaining amounts of the Termination Contracts which fell due on 7 March 2024, i.e. after
7 days of non-payment, totalled EUR 101,046 net.
47. Finally, the Single Judge recalled the well-established jurisprudence of the Dispute
Resolution Chamber which provided that in the event of an acceleration clause, the Single
Judge is empowered to award interest as from the day following the due date on which the
acceleration clause was triggered.
48. As such, the Single Judge concluded that the applicable interest pursuant to the Termination
Contracts amounted to 10% per annum and shall accrue as from the respective dates of
maturity, i.e. 1 March 2024 for the EUR 20,261.50 and 8 March 2024 for the EUR 101,046.
49. With regard to the payment and production of documents related to the taxes, state levies
and other contributions, the Single Judge determined that in line with the contractual
language of the Termination Contracts, as well as FIFA’s past practice the Respondent shall
be ordered to provide the Claimant with the relevant certificate attesting the payment of
taxes to the competent authorities with respect to the amounts which fell due under the
Termination Contracts, i.e., the amounts detailed in points 4 and 6 above.
i. Art. 12bis of the Regulations
50. In continuation, the Single Judge referred to art. 12bis par. 2 of the Regulations, which
stipulates that any club found to have delayed a due payment for more than 30 days without
a prima facie contractual basis may be sanctioned in accordance with art. 12bis par. 4 of the
Regulations.
51. To this end, the Single Judge confirmed that the Player put the Club in default of payment
of EUR 20,261.50, which had fallen due more than 30 days before, plus the amounts then
falling due pursuant to the acceleration clauses, and granted the club a 10-day deadline to
cure such breach of contract.
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REF. FPSD-14627
52. Accordingly, the Single Judge confirmed that the club had delayed a due payment without a
prima facia contractual basis. It followed that the criteria enshrined in art. 12bis of the
Regulations was met in the case at hand.
53. The Single Judge further established that by virtue of art. 12bis par. 4 of the Regulations she
has competence to impose sanctions on the club. On account of the above and bearing in
mind that this is the first offense by the club within the last two years, the Single Judge
decided to impose a warning on the club in accordance with art. 12bis par. 4 lit. a) of the
Regulations.
54. In this connection, the Single Judge highlighted that a repeated offence will be considered
as an aggravating circumstance and lead to a more severe penalty in accordance with art.
12bis par. 6 of the Regulations.
ii. Compliance with monetary decisions
55. Finally, taking into account the applicable Regulations, the Single Judge referred to art. 24
par. 1 and 2 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.
56. 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. The overall
maximum duration of the registration ban shall be of up to three entire and consecutive
registration periods.
57. Therefore, bearing in mind the above, the Single Judge decided that the Respondent must
pay the full amount due (including all applicable interest) to the Claimant within 45 days of
notification of the decision, failing which, at the request of the Claimant, a ban from
registering any new players, either nationally or internationally, for the maximum duration
of three entire and consecutive registration periods shall become immediately effective on
the Respondent in accordance with art. 24 par. 2, 4, and 7 of the Regulations.
58. The Respondent shall make full payment (including all applicable interest) to the bank
account provided by the Claimant in the Bank Account Registration Form, which is attached
to the present decision.
59. 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. 24 par.
8 of the Regulations.
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REF. FPSD-14627
d. Costs
60. The Single Judge 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 agent,
or match agent”. Accordingly, the Single Judge decided that no procedural costs were to be
imposed on the parties.
61. Likewise, and for the sake of completeness, the Single Judge recalled the contents of art. 25
par. 8 of the Procedural Rules and decided that no procedural compensation shall be
awarded in these proceedings.
62. Lastly, the Single Judge concluded its deliberations by rejecting any other requests for relief
made by any of the parties.
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REF. FPSD-14627
IV. Decision of the Dispute Resolution Chamber
1.
The claim of the Claimant, Besart Abdurahimi, is partially accepted.
2.
The Respondent, Apollon Limassol, must pay to the Claimant the following amount(s):
- EUR 20,261.50 net as outstanding remuneration plus 10% interest p.a. as from 1 March
2024 until the date of effective payment;
- EUR 101,046 net as outstanding remuneration plus 10% interest p.a. as from 8 March
2024 until the date of effective payment.
3.
The Respondent is ordered to provide the Claimant with the corresponding tax certificates
for the payment of taxes to the competent authorities with respect to all payments made
under the Termination Contracts at the basis of this claim, i.e., sums referred to in item 2,
above.
4.
Any further claims of the Claimant are rejected.
5.
A warning is imposed on the Respondent.
6.
Full payment (including all applicable interest) shall be made to the bank account indicated
in the enclosed Bank Account Registration Form.
7.
Pursuant to art. 24 of the Regulations on the Status and Transfer of Players, if full payment
(including all applicable interest) is not made within 45 days of notification of this decision,
the following consequences shall apply:
1. The Respondent shall be banned from registering any new players, either nationally or
internationally, up until the due amount is paid. The maximum duration of the ban shall
be of up to three entire and consecutive registration periods.
2. The present matter shall be submitted, upon request, to the FIFA Disciplinary Committee
in the event that full payment (including all applicable interest) is still not made by the
end of the three entire and consecutive registration periods.
8.
The consequences shall only be enforced at the request of the Claimant in accordance
with art. 24 par. 7 and 8 and art. 25 of the Regulations on the Status and Transfer of Players.
9.
This decision is rendered without costs.
For the Football Tribunal:
Emilio García Silvero
Chief Legal & Compliance Officer
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REF. FPSD-14627
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 Governing the Football
Tribunal).
CONTACT INFORMATION
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396 Alhambra Circle, 6th floor, Coral Gables, Miami, Florida, USA 33134
legal.fifa.com | [email protected] | T: +41 (0)43 222 7777
pg. 16