Labour Disputes
Texto da decisão
REF. FPSD-10615
Decision of the
Dispute Resolution Chamber
passed on 14 September 2023
regarding an employment-related dispute concerning
the player Dylan Felipe Borrero Caicedo
BY:
Martín AULETTA (Argentina), Deputy Chairperson
Mario FLORES CHEMOR (Mexico), member
Stella MARIS JUNCOS (Argentina), member
CLAIMANT:
Dylan Felipe Borrero Caicedo, Colombia
Represented by Breno Costa Ramos Tannuri
RESPONDENT:
Clube Atlético Mineiro, Brazil
pg. 2
REF. FPSD-10615
I. Facts of the case
The Parties
1.
The parties to the dispute are the player Dylan Felipe Borrero Caicedo from Colombia
(hereinafter: Claimant or player) and the football club Clube Atlético Mineiro from Brazil
(hereinafter: Atlético, club or Respondent).
The Employment Contract
2.
On 20 May 2019, the player and the club concluded an employment agreement valid as
from 5 January 2020 until 31 December 2024. Contextually, the player was registered with
the club on 21 January 2020 (hereinafter: the Employment Contract).
3.
Under clause 1.4 of the Employment Contract, the club undertook to pay to the player 30%
over any transfer fee it received in case of a permanent transfer of the player to a third
club (hereinafter: the Transfer Bonus).
The amendment to the Employment Contract
4.
On 18 April 2022, the player and the club entered into an agreement to amend the
Employment Contract, in that the Transfer Bonus percentage was reduced from 30% to
25%.
The player’s transfer to New England Revolution
5.
On 20 April 2022, the player, the club, and the Major League Soccer (MLS) signed a transfer
agreement by means of which the player’s registration was transferred from the club to
the North American club, New England Revolution, affiliated to the MLS, against payment
of a transfer fee of USD 4,000,000. Contextually, the player was registered with New
England Revolution on 29 April 2022.
The First Agreement
6.
On the same date, the player and the club signed a document titled “Private Agreement for
Payment commitment and Other Covenants” as freely translated from Portuguese to English
(hereinafter: the First Agreement), according to which the Respondent undertook to pay to
the Claimant USD 896,200, conditioned to his satisfactory transfer to New England
Revolution.
The Second Agreement
7.
On 22 July 2022, the player and the club concluded a second document titled “Private
Agreement for Payment commitment and Other Covenants” as freely translated from
pg. 3
REF. FPSD-10615
Portuguese to English (hereinafter: the Second Agreement), according to which the parties
rearranged the Respondent’s payment obligations, and the Respondent undertook to pay
the Claimant as follows:
a.
b.
c.
d.
“the amount in Brazilian Reais equivalent to USD 336,075.00” by 30 July 2022;
“the amount in Brazilian Reais equivalent to USD 224,050.00“ by 15 August 2022;
“the amount in Brazilian Reais equivalent to USD 168,037.50” by 25 April 2023;
“the amount in Brazilian Reais equivalent to USD 168,037.50” by 25 April 2024.
8.
For completeness, the most relevant provisions of the Second Agreement are reproduced
in continuation.
9.
The recitals of the Second Agreement read as follows:
“(i) ATLÉTICO definitively transferred the [player]´s federative rights to Major League
Soccer (MLS), more precisely to the New England Revolution team (“New England”), on
20.04.2022;
(ii) the Parties above described signed on 20.04.2022 the [First Agreement], by which
ATLÉTICO undertook to pay the [player], as he holds 25% (twenty five percent) of his
own economic rights, the amount in Brazilian Reais equivalent to USD 896,200.00
(eight hundred and ninety-six thousand, two hundred US dollars), to be paid in 3
(three) instalments, the first instalment in the amount of USD 560,125.00 (five hundred
and sixty thousand, one hundred and twenty five US dollars), the second instalment
in the amount of USD 168,037.50 (one hundred and sixty eight thousand, thirty seven
US dollars and fifty cents) and the third instalment in the amount of USD 168,037.50
(one hundred and sixty eight thousand, thirty seven US dollars and fifty cents).
(iii) according to item “3” of the [First Agreement], the Parties established that the
payment of the amounts to the [player]would be made within 10 (ten) days from the
receipt by ATLÉTICO of each instalment of the transfer fee adjusted with MLS;
(iv) ATLÉTICO received the first instalment due to the final transfer, but due to
difficulties arising from cash flow, did not pay the [player], within the agreed period,
of his (ATHLETE) first parcel;
(v) ATLÉTICO adjusted with the MLS the advance payment of the second and third
instalments due to the definitive transfer;
(vi) the Parties intend to adjust a new payment method for the first instalment to the
[player], as well as ratify the payment method for the second and third instalments
provided for in point “(ii)” above;”
10. Clauses 1 and 2 of the Second Agreement read as follows:
pg. 4
REF. FPSD-10615
“1. Through this instrument, ATLÉTICO undertakes to pay the [player]the first
instalment, which is in arrears, in the amount in Brazilian Reais equivalent to USD
560,125.00 (five hundred and sixty thousand, one hundred and twenty five US dollars),
according to the following schedule:
I. 60% (sixty percent) of the overdue debt, that is, the amount in Brazilian Reais
equivalent to USD 336,075.00 (three hundred and thirty six thousand, seventy five US
dollars), no later than on 30.07.2022; and
II. 40% (forty percent) of the overdue debt, that is, the amount in Brazilian Reais
equivalent to USD 224,050.00 (two hundred and twenty four thousand, fifty US dollars)
no later than 15.08.2022.
2. Additionally, the Parties agree that, even though ATLÉTICO is anticipating the receipt
of the second and third instalments of the final transfer fee from MLS, the method of
payment of the second and third instalments to the [player], in the amount in
Brazilian Reais equivalent to USD 168,037.50 (one hundred and sixty-eight thousand,
thirty seven US dollars and fifty cents), each, will be according to the following
schedule:
I. The second instalment in the amount in Brazilian Reais equivalent to USD
168,037.50 (one hundred and sixty-eight thousand, thirty seven US dollars and fifty
cents) must be paid by ATLÉTICO to the [player]no later than 25.04.2023; and
II. The third instalment in the amount in Brazilian Reais equivalent to USD 168,037.50
(one hundred and sixty-eight thousand, thirty seven US dollars and fifty cents) must
be paid by ATLÉTICO to the [player]no later than 25.04.2024.”
11. Clauses 5 and 6 of the Second Agreement read as follows:
“5. In case of delay in payment, the [player]must notify ATLÉTICO in writing so that,
within a maximum period 48 (forty-eight) hours, ATLÉTICO can purge the arrears.
5.1. If ATLÉTICO remains in default after the stipulated period, the total amount will
be due in advance and immediately and ATLÉTICO must comply with the total payment
of the amount due, plus a fine of 10% (ten percent), in addition to interest of 01% (one
percent) per month, until the effective payment date.
6. If ATLÉTICO remains in default after the stipulated period, the total amount will be
due in advance and immediately and ATLÉTICO must comply with the total payment
of the amount due, plus a fine of 10% (ten percent), in addition to interest of 01% (one
percent) per month, until the effective payment date.”
pg. 5
REF. FPSD-10615
12. Clause 12 of the Second Agreement reads as follows:
“12. The Parties elect the Dispute Resolution Chamber of the FIFA Football Tribunal,
for the resolution of any disputes, doubts and controversies arising from this
instrument to the detriment of any other, despite of how privileged it may be or may
come to be in the future.”
The assignment of credits by the player
13. On 22 July 2022, the player sent a letter to the club (hereinafter: the Credit Assignment Letter)
and stated that he assigned some credits to a company called “BRIO PRO INTERMEDIAÇÃO
ESPORTIVA LTDA” (hereinafter: Brio or Company).
14. The Credit Assignment Letter reads as follows (freely translated from Spanish to English):
“1. With reference to the provisions of the [Second Agreement] and the Letter sent to
you on 25 April 2022, I hereby inform and request the following.
2. It is common knowledge that, due to the cash flow difficulties of [Atlético], a new
form of payment of the amount of USD 560,125.00 (five hundred and sixty thousand
one hundred and twenty-five US dollars), which is already due, and which refers to the
first instalment due, was established in the [Second Agreement].
3. The new schedule foresees the payment of 60% (sixty percent) of the overdue debt,
that is, the amount in reais equivalent to USD 336,075.00 (three hundred and thirtysix thousand seventy-five US dollars), no later than 30 July 2022; and 40% (forty
percent) of the overdue debt, that is, the amount in reais equivalent to USD 224,050.00
(two hundred and twenty-four thousand and fifty US dollars), no later than 15 August
2022.
4. In addition, as is known, it was established in the [Second Agreement] that
[Atlético]adjusted the anticipation of receipt of the second and third instalments from
MLS, and that the form of payment of the second and third instalments will follow the
following schedule: the second instalment, the amount in reais equivalent to USD
168.037.50 (one hundred and sixty-eight thousand and thirty-seven US dollars and
fifty cents), shall be paid by [Atlético]no later than 25 April 2023; and the third
instalment, the amount in reais equivalent to USD 168,037.50 (one hundred and sixtyeight thousand and thirty-seven US dollars and fifty cents), shall be paid by
[Atlético]no later than 25 April 2024.
5. As informed in the Letter, I assigned to the company BRIO PRO INTERMEDIAÇÃO
ESPORTIVA LTDA., registered in the CNPJ n. 21.677.383/0001-07 (the "BRIO"), part of
the credit that was guaranteed to me, more precisely the amount in reais equivalent
pg. 6
REF. FPSD-10615
to USD 596.200,00 (five hundred ninety-six thousand two hundred US dollars), and I
requested the payment of this amount directly to BRIO, in its bank account.
6. Thus, in view of the signing of the [Second Agreement], and my commitment to
BRIO, I hereby reiterate the request for payment of the amount detailed above, directly
to BRIO, so that, of the 60% (sixty percent) of the overdue debt, referring to the first
installment, the amount in reais equivalent to USD 224,050.00 (two hundred and
twenty-four thousand and fifty US dollars) shall be paid to BRIO; and of the 40% (forty
per cent) of the overdue debt, referring to the first instalment, the amount in reais
equivalent to USD 149,366.66 (one hundred and forty-nine thousand and three
hundred and sixty-six US dollars and sixty-six cents) shall be paid to BRIO.
7. As for the second and third instalments, the amount in reais equivalent to USD
111,391.67 (one hundred and eleven thousand three hundred and ninety-one US
dollars and sixty-seven cents) of each instalment shall be paid directly to BRIO.
8. Please note that all payments due to BRIO must be made by transferring funds to
the following BRIO bank account: (…)
9. As for the payments due to me, these are to be made by transferring funds to the
following bank account of which I am the account holder: (…)
Sincerely,
DYLAN FELIPE BORRERO CAICEDO
15. The Credit Assignment Letter possesses a “acknowledged and agreed” area for the club to
sign, which it did via electronic signature.
The payments made by the club
16. On 29 July 2022, the Respondent paid:
• BRL 1,168,398.35 to Brio;
• BRL 584,199.17 to the Claimant.
17. On 16 August 2022, the Respondent paid:
• BRL 380,324.91 to the Claimant;
• BRL 1760,649.72 to Brio.
18. These payments are not disputed by the parties.
The agreement of recession
19. By document dated 21 April 2023, the player and the Company signed an Agreement of
Recession (hereinafter: the Agreement of Recession), by means of which inter alia the Credit
pg. 7
REF. FPSD-10615
Assignment Letter was rescinded, and it was established that only the player was entitled
to the amounts established under the Second Agreement. The Respondent contests the
date of execution of the Agreement of Recession.
The default notice
20. On 28 April 2023, the Claimant put the Respondent in default and requested payment of
USD 168,037.50 due on 25 April 2023 under the Second Agreement setting a 48 hours’ time
limit in order to remedy the default.
pg. 8
REF. FPSD-10615
II. Proceedings before FIFA
21. On 19 June 2023, the Claimant filed the claim at hand before FIFA. A brief summary of the
position of the parties is detailed in continuation.
a. Claim of the Claimant
22. As the jurisdiction of FIFA, the player argued as follows:
•
FIFA is competent to hear disputes between players and clubs arising from
private agreements, in accordance with art. 22 par. 1 lit. (b) of the FIFA
Regulations on the Status and Transfer of Players (RSTP).
•
the Second Agreement contains a valid arbitration clause, which confers
jurisdiction on the FIFA Dispute Resolution Chamber (DRC) to hear the case.
23. As to the substance of his claim, the player argued as follows:
•
the club breached the principle of pacta sunt servanda by failing to pay the first
instalment as agreed in the Second Agreement.
•
the failure of the club to pay said first instalment triggered the acceleration
clause, which made all the remaining instalments immediately due, as well as the
penalty and the default interest, as agreed by the parties in the Second
Agreement.
•
the acceleration clause, the penalty and the default interest are valid and binding,
in accordance with the FIFA regulations, general principles of law, and the
jurisprudence of FIFA and the Court of Arbitration for Sport (CAS).
•
the club should pay him the outstanding amount, plus the penalty and the default
interest, as well as costs, in accordance with the Second Agreement and the
principle of pacta sunt servanda.
24. The Claimant requested the following relief, quoted verbatim:
“FIRST – To uphold the claim filed by the Player;
SECOND – To order the Club to pay the Player USD 168,037.50, plus default interest at
the rate of 12% p.a. as from 26 April 2023 until the date of effective payment;
THIRD – To order the Club to pay the Player USD 168,037.50, plus default interest at a
rate of 12% p.a. as from 4 May 2023 until the date of effective payment;
pg. 9
REF. FPSD-10615
FOURTH – To order the Club to pay the Player an amount of USD 33.607,50 (thirtythree thousand, six hundred and seven US dollars and fifty cents) as penalty fee;
FIFTH – To open the proceedings regarding the present dispute and notify the Club
immediately (cf. Art. 21, par. 1 of the FIFA Procedural Rules).”
b. Position of the Respondent
25. In its reply, the club started by challenging the jurisdiction of FIFA on the grounds that the
claim does not arise from the parties’ previous employment relationship, but from a
separate contract regarding the transfer of the player to another club (i.e., the Second
Agreement). The club argues that this separate contract falls outside of FIFA’s jurisdiction
and competence to adjudicate on the dispute.
26. As to the substance, the Respondent disputes the enforceability of the claimed debt on the
grounds that the Claimant failed to properly put the Respondent in default according to
the relevant FIFA regulations, namely art. 12bis of the RSTP, in that the default notice only
granted the club 48 hours to pay.
27. The club also disputes the standing to sue of the Claimant on the grounds that he assigned
a portion of his credits to a third party, namely the Company, and therefore cannot request
their payment on his own behalf. In the respect, the club argued that it made the following
payments to the Company and to the player:
(i) To Brio:
• BRL 1.168.398,35 on 29 July 2022 (Exhibit nr. 03), corresponding to the “amount in
reais equivalent to USD 224.050,00 (two hundred and twenty-four thousand fifty US
dollars)”, cf. the paragraph 06 of the “Assignment Letter”; and
• BRL 760.649,72 on 16 August 2022 (Exhibit nr. 04), corresponding to the “amount in
reais equivalent to USD 149.366,66 (one hundred and forty-nine thousand three
hundred and sixty-six US dollars and sixty-six cents)”, cf. the paragraph 06 of the
“Assignment Letter”.
(ii) To the Claimant:
• BRL 584.199,17 on 29 July 2022 (Exhibit nr. 05), corresponding to the remaining USD
112.025,00 of the installment foreseen in Clause 1., lit. “I.”, of the Contract (USD
336.075,00 minus the USD 224.050,00 assigned to Brio); and
• BRL 380.324,91 on 16 August 2022 (Exhibit nr. 06), corresponding to the remaining
USD 74.683,34 of the installment foreseen in Clause 1, lit. “II.”, of the Contract (USD
224.050,00 minus the USD 149.366,66 assigned to Brio).”
pg. 10
REF. FPSD-10615
28. The club further clarified the following, quoted verbatim:
“Accordingly, the Respondent respectfully requests the DRC to partially dismiss the
present claim on its merits, pursuant to the well-established jurisprudence of both the
FIFA and the CAS12, insofar as the Player lacks standing to sue regarding a portion of
the credits whose payment he requested in casu.
Considering, therefore, that they arise from the installments foreseen in Clause 2. of
the Contract, of which he assigned USD 111.391,67 to Brio, the Respondent shall be
ordered to pay, if any, an amount not greater than USD 56.645,83 or, at most, USD
113.291,66, what is hereby assumed only for the sake of argument in the unlikely event
that the DRC rejects all other objections raised herein.
For ease of understanding, please refer to the calculations provided below:”
Maturity Date Original Amount Assignment to Brio Player’s
Entitlement
Clause 2., “I.” 25.04.2023
USD 168.037,50
USD 111.391,67
USD 56.645,83
Clause 2., “II.” 25.04.2024
USD 168.037,50
USD 111.391,67
USD 56.645,83
TOTAL
USD 113.291,66
Ref.
29. Additionally, the club disputes the applicability and proportionality of the penalty clause
and interest rate stipulated in the Second Agreement on the grounds that they are
excessive and abusive and contravene the principles of contractual law.
30. The Respondent filed the following request for relief, quoted verbatim:
“1. That the DRC declares itself incompetent to hear the present dispute, thereby
deeming the State
ment of Claim lodged by the Player inadmissible.
2. Alternatively, in the event that the DRC considers itself competent, that the claim
filed by the Player is dismissed on its merits on the following grounds:
- The lack of enforceability of the claimed debt due to the Claimant’s failure to properly
place the Respondent in default according to the relevant FIFA Regulations, namely
art. 12bis, par. 3, of the RSTP;
- On a subsidiary basis, the Player’s lack of standing to sue regarding a portion of the
credits whose payment he requested in casu, in which case the Respondent shall be
ordered to pay an amount not greater than USD 56.645,83 or, at most, USD
113.291,66, depending on the Panel’s decision regarding the acceleration of the
installment specified in Clause 2., lit. “II.”, of the Contract; and
pg. 11
REF. FPSD-10615
- In the event that Atlético is ordered to pay any amounts to the Player, that the penalty
clause stipulated in Clause 6 of the Contract is entirely disregarded or, on a subsidiary
basis, that its scope is significantly reduced by the Panel as requested hereby.
3. That the Player is ordered to bear all costs related to the present proceedings.”
c. Rejoinder of the Claimant
31. In his rejoinder, the Claimant argued as follows:
Jurisdiction
32. The player insists that the dispute is employment-related and arises from the Employment
Contract and its amendments. He cites FIFA regulations, CAS jurisprudence, and Swiss law
to confirm the DRC’s competence and jurisdiction.
33. The player argues that the Transfer Bonus that he is entitled to receive from the club per
the multiple contracts signed is a part of his remuneration under his employment
relationship and is not in violation of FIFA’s rules on third-party ownership of players’
economic rights.
34. The player contends that the First Agreement and the Second Agreement are both directly
linked to his Employment Contract and its amendment, which ratified his monetary
entitlement. He asserts that there would not have been any of these agreements if there
was not the signature of the Employment Contract and corresponding amendment.
35. The player relies on CAS jurisprudence to support his position that the notion of
“employment-related disputes” includes a much wider range of disputes than just disputes
arising over employment agreements. He states that the scope of art. 22 of the RSTP
includes also disputes that may arise after the termination of the employment relationship
and are “employment related”, such as in connection with the First Agreement and the
Second Agreement in the matter at hand.
Assignment of credits
36. The player contends that the letter dated 22 July 2022 (i.e., the Credit Assignment Letter),
which the club relies on as evidence of the assignment, is questionable and does not meet
the criteria of a valid and binding assignment under Swiss law, which is applicable in this
case.
37. The player asserts that he communicated to the club that the payment of the first
instalment under the Second Agreement had to be done to him and not to Brio, by sending
a notice of default on 28 April 2023, giving the club 48 hours to clear the arrears. He states
pg. 12
REF. FPSD-10615
that the club did not dispute or reply to the default notice, which implied its acceptance of
the new instructions.
38. The player submits that he also entered into the Agreement of Recession with Brio on 21
April 2023, which formally confirmed that Brio was not entitled to receive any further
portion of the claim and that the player had the sole right to receive the full amount due
from the club. He cites a Swiss Federal Tribunal decision that supports his position that
such an agreement is enough to protect the interests of the debtor and avoid any risk of
double payment.
39. The player concludes that he has standing to sue for the entire claim and that the club’s
argument based on the Credit Assignment Letter is legally groundless and made in bad
faith.
Contractual penalty
40. The player claims that the penalty clause was validly agreed upon by the parties under the
Second Agreement and was proportionate and reasonable. He invokes the principles of
freedom of contract, pacta sunt servanda, and contractual loyalty. He also distinguishes
between penalty, default interest, and acceleration clause as different contractual
consequences for breach.
41. The player argues that the penalty clause was intended to encourage the performance of
the main obligation and to secure his interests as a creditor. He cites Swiss law and CAS
jurisprudence to support his position that a penalty of 10% of the outstanding amount is
not excessive or punitive – as opposed to the argumentation of the club in this regard.
42. The player contends that the club was fully aware of the penalty clause when it drafted and
signed the Second Agreement. He states that the club did not dispute or question the
penalty clause until after it failed to pay the instalments by the due dates.
43. The player asserts that he acted in good faith by sending a notice of default to the club,
giving it 48 hours to clear the arrears, otherwise he would initiate legal proceedings. He
states that the club did not pay or reply to the notice of default, which triggered the penalty,
acceleration clause, and default interest.
44. The player concludes that the club is liable to pay him the outstanding amount plus a
penalty of 10%, in accordance with the Second Agreement and Swiss law.
45. The Claimant filed the following request for relief, quoted verbatim:
“FIRST – To uphold the claim filed by the Player;
pg. 13
REF. FPSD-10615
SECOND – To order the Club to pay the Player USD 168,037.50, plus default interest at
the rate of 12% p.a. as from 26 April 2023 until the date of effective payment;
THIRD – To order the Club to pay the Player USD 168,037.50, plus default interest at a
rate of 12% p.a. as from 2 May 2023 until the date of effective payment;
FOURTH – To order the Club to pay the Player an amount of USD 33,607.50 (thirtythree thousand, six hundred and seven US dollars and fifty cents) as penalty fee;
FIFTH – To confirm that the ongoing proceedings is free of any costs.”
d. Final comments of the Respondent
46. In its final comments, the Respondent raised the following arguments:
Jurisdiction
47. The club reiterated its position that the DRC is not competent to hear the case because the
dispute is not employment-related. The club claims that the dispute concerns a separate
contract that has no connection with the player's services as a professional football player,
and that that the mere fact that the player's entitlement to economic rights (i.e., the
Transfer Bonus) was first established in the Employment Contract is not sufficient for the
case to fall within the definition of an "employment-related dispute" according to the RSTP.
48. On this note, the club refers to FIFA jurisprudence on image rights agreements, which
requires a direct link between a separate contractual arrangement and the services of the
player as a player for a claim to be qualified as an "employment-related dispute" and fall
within the competence of the DRC. The club contends that this rationale applies to the
present case, as the player's claim concerns a credit stipulated in an autonomous contract
(i.e., the Second Agreement) and whose payment is not triggered by his services as a player,
but rather from his transfer to another league.
Standing to sue of the player
49. The club reiterates that the player lacks standing to sue for the amounts he assigned to
Brio, as he did not communicate the revocation of the assignment to the Club nor
respected the formal requirements under the Swiss Code of Obligations (SCO) to do so.
As to the validity of the Agreement of Recession
50. The club claims that the player never informed it of the Agreement of Recession and
questions its authenticity and validity since this agreement may have been simulated or
violated formal requirements, and that it is not enforceable against the club, as it was not
notified or consented to it.
pg. 14
REF. FPSD-10615
51. The club argues that the Agreement of Recession may be invalid for several reasons. First,
the club claims that this agreement may have been simulated or fabricated by the player
and Brio after the player lodged his claim. The club questions the authenticity of such
agreement and argues that it was not attached to the player’s initial statement of claim,
but only enclosed to his rejoinder after his standing was firstly challenged by the club. The
club also notes that the Agreement of Recession was drafted in English, while the Credit
Assignment Letter was executed in both Spanish and Portuguese. The club requests that
the DRC either reduces the applicable standard of proof and deems the Agreement of
Recession null and void, or shifts the burden of proof to the player’s detriment and orders
him to demonstrate beyond any reasonable doubt that it was indeed executed on the date
claimed.
52. Second, even if the Agreement of Recession is not considered simulated, the club argues
that it violated formal requirements established in Swiss law. The club claims that since the
Agreement of Recession is an accessory contract to the Credit Assignment Letter, it should
have respected its formal requirements, including obtaining the club’s express and written
consent. The club also argues that such an obligation arises from a joint interpretation of
art. 13.1 and 165.1 of the SCO, which require a contract to be concluded in writing if it
imposes obligations on a third party.
53. Third, the club argues that the Agreement of Recession is not enforceable against it. The
club insists that it was not notified or consented to this agreement, and that the player
never made it aware of its existence prior to enclosing it to his rejoinder. The club argues
that this behaviour violates the principle of good faith and disregards the “legitimate
expectation” that the player had created when he addressed the Credit Assignment Letter
to the club.
54. Therefore, based on these arguments, the club requests that the DRC deems the
Agreement of Recession not enforceable against it and disregards it when ruling on the
case.
Risk of duplicate payments
55. The club argues that there would be a risk of duplicate payments if it were to comply with
the player’s instructions as outlined in the default notice as it had a legitimate doubt as to
the benefit of whom, the player or Brio, the payment was supposed to be performed. The
club grounds its position pursuant to art. 168, paragraphs 1 and 2, of the SCO (by analogy).
Implied acceptance
56. The club argues that it did not implicitly accept the terms and conditions outlined in the
default notice, as claimed by the player. The club contends that its lack of response cannot
be interpreted as an implied acceptance of its terms. The club also argues that art. 6 of the
pg. 15
REF. FPSD-10615
SCO, which provides for an implied acceptance of an offer if it is not rejected within a
reasonable time, does not apply to this case, as it refers to the conclusion of a contract and
not to the enforceability of a private agreement between two parties towards a third party.
Lack of enforceability of the claimed debt and impossibility to enforce the penalty clause
and to impose sanctions
57. The club argues that it had a prima facie contractual basis not to perform any payments to
the player, as it had a legitimate doubt as to the benefit of whom, the player or Brio, the
payment was supposed to be performed. Likewise, as the player’s default notice failed to
meet the formal requirements established in art. 12bis, par. 3, of the RSTP, the club argues
that the claimed debt is not enforceable, and that FIFA should refrain from imposing
sanctions against it.
58. Furthermore, the club insists that the penalty clause in the Second Agreement, which
provides for a 10% fine and a 12% interest rate per annum, should not be applicable or
significantly reduced.
59. The club filed the following request for relief, quoted verbatim:
“In view of the foregoing, the Respondent prays for relief as follows:
1.
That the DRC shall declare itself incompetent to hear the present dispute,
thereby deeming the Statement of Claim submitted by the Player inadmissible;
2.
Alternatively, that the claim filed by the Player is dismissed either in full or in
part on its merits, considering:
i) The lack of enforceability of the claimed debt, given the Claimant’s failure to properly
place the Club in default pursuant to the relevant FIFA Regulations (which, in any case,
shall prevent the DRC from imposing sanctions on [Atlético]);
ii)
On a subsidiary basis, the Player’s lack of standing to sue regarding the
amounts he had previously assigned to Brio, in which case the Respondent shall be
ordered to pay an amount not greater than USD 56.645,83 or, at most, USD
113.291,66. FIFA shall so decide on the following grounds:
a)
The inadmissibility of the Agreement of Recession, in light of the Player’s
abusive procedural behavior in attaching it only to the Replica, but not even
mentioning its existence in, nor enclosing it to, the Statement of Claim, despite
claiming the document to have been signed on 21 April 2023 (and doing so only after
his standing was first challenged in the Statement of Defense);
b)
On a subsidiary basis, the invalidity of the Agreement of Recession, in case:
pg. 16
REF. FPSD-10615
•
the DRC considers it to have been simulated by the Player and Brio by reducing
the applicable standard of proof;
•
subsidiarily, the Claimant fails to establish the contrary beyond any
reasonable doubt should the burden of proof be shifted to his detriment (and to the
Club’s benefit); or
•
subsidiarily, such an agreement is considered not to have respected the formal
requirements established in the SCO.
c)
On a subsidiary basis, the lack of enforceability of the Agreement of Recession,
since the Player never made the Respondent aware of its existence prior to enclosing
it to the Replica, in clear violation of the principle of good faith and disregarding the
“legitimate expectation” he had created to that effect; and
d)
The risk of duplicate payments and the inexistence of an implied acceptance
by [Atlético] as to the terms and conditions outlined in the Notice of Default.
iii)
In the event that Atlético is ordered to pay any amounts to the Player, that the
penalty clause stipulated in Clause 6 of the Economic Rights Contract is entirely
disregard or, on a subsidiary basis, significantly reduced by the DRC as requested
herein.
3.
That the Player is ordered to bear all costs associated with the present
proceedings, if any.”
pg. 17
REF. FPSD-10615
III. Considerations of the Dispute Resolution Chamber
a. Competence and applicable legal framework
60. First of all, the DRC (hereinafter also referred to as Chamber) 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 19 June 2023 and submitted for decision on 14 September
2023. 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.
61. 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 par. 1 lit. b)
of the RSTP (May 2023 edition) the DRC is in principle competent to deal with the matter at
stake, which concerns an employment-related dispute with an international dimension
between a Colombian player and a Brazilian club.
62. At this point, the DRC noted that the Respondent has challenged the jurisdiction of FIFA to
hear the claim of the Claimant since the same is not employment related.
63. In this respect, the DRC underlined that it stems from the file that the parties agreed on a
payment of remuneration akin to a bonus to the player in case of his future transfer (i.e.,
he was entitled to a share of his economic rights), which is naturally related to his
employment relationship. In addition, the Chamber could not help to notice that Second
Agreement has a jurisdiction clause in favour of FIFA.
64. Consequently, the DRC found that the contractual arrangement of the parties meets the
threshold established by art. 22 of the RSTP in respect of a dispute which is related to the
player’s employment at the club. The Chamber was furthermore comforted with this
conclusion while confirming that the notion of employment related dispute is reflected in
the jurisprudence of both the Football Tribunal and CAS and includes by all means a wider
range of disputes than just simply those arising out of employment agreements.
65. As such, the DRC concluded that the Football Tribunal has jurisdiction to hear the claim.
For the sake of completeness, the Chamber highlighted that the issue of the parties’
standing is of substance and not admissibility and will be dealt with accordingly in the
relevant section below.
66. By the same token, the Chamber did notice the argumentation of the club with respect to
the applicable law, i.e., the references made to Swiss Law in its submissions.
pg. 18
REF. FPSD-10615
67. To this end, the Chamber recalled that when deciding a dispute, FIFA’s regulations prevail
over any national law chosen by the parties. In this regard, the main objective of the FIFA
regulations is to create a standard set of rules to which all the actors within the football
community are subject to and can rely on.
68. In the DRC’s view, this objective would not be achievable if the Football Tribunal would have
to apply the national law of a specific party on every dispute brought to it. It is in the interest
of football that the amounts payable under a contract are based on uniform criteria rather
than on provisions of national law that may vary considerable from country to country.
Therefore, the DRC found that it is not appropriate to apply the principles of a particular
national law to the issue at stake but rather the FIFA regulations, general principles of law
and, where existing, the Chamber’s well-established jurisprudence.
69. For the sake of completeness, the DRC underlined, for example, the cases of dismissal
notice periods in favour of the employer (i.e., clubs) of only a couple of days included in
some mandatory national (labour) laws, cases in which, in general and according to the
extensive and firm case law of the Chamber, the time limits set out in the FIFA regulations,
and not the former, are considered in the disputes before FIFA.
70. Lastly, 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 RSTP (May 2023), and considering that the present claim was lodged on 19 June 2023,
the same edition of said regulations (hereinafter: the Regulations) is applicable to the matter
at hand as to the substance.
b. Burden of proof
71. 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
72. 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.
pg. 19
REF. FPSD-10615
i. Main legal discussion and considerations
73. The foregoing having been established, the Chamber moved to the substance of the
matter, and took note of the fact that this is a claim of a player against a club for
outstanding remuneration. While the player is collecting his alleged credit, a number of
objections, including the issue of standing to sue, has been raised by the club.
74. Accordingly, the Chamber acknowledged that the first issue to be tackled was whether the
Claimant has standing to sue light of the assignment of credits.
75. As a preliminary note and at a general level, the DRC recalled that standing is characterised
as a matter - as added above - of substantive law as opposed to procedural law, and that
such standing derives from the fact of the party in question being the legal holder of the
right in dispute. In other words, a party has standing to sue (or be sued) if the claim affects
a substantive right of its own. The DRC underlined that both the case law of the Football
Tribunal and the precedents of CAS have repeatedly confirmed such a consideration.
76. Having examined the file, the DRC was able to conclude that per the Credit Assignment
Letter, the Claimant had assigned a part only of his receivables relating to the Second
Agreement. As such, it would appear, in the DRC’s view, that the player would not be
entitled to collect those amounts which he had passed on to third parties, namely the
Company.
77. However, the DRC did notice that such assignment was later rescinded by means of the
Agreement of Recession. While it seemed that the Claimant never informed the
Respondent of this, it also true that the Respondent was in default of payment of the
amounts due under the Second Agreement, namely USD 168,037.50 due on 25 April 2023,
and that it was then placed in default by the Claimant on 28 April 2023, to no avail.
78. As such, and already entering into the other matter at stake in these proceedings (i.e., the
player’s entitlement to any overdue payables), even if the allegations of the Respondent
could be taken into account as to the validity of the Agreement of Recession, the crux of
the matter would still be that the club never replied to the default notice, whereby the
Claimant, in accordance with such Agreement of Recession, sought to collect the entire
debt from the Respondent, and not his quota only per the Credit Assignment Letter.
79. The DRC found therefore that the behaviour of the parties is of paramount importance in
the resolution of the dispute at hand: the player to some degree cured his failure to inform
the club of the Agreement of Recession via the default notice, which was never answered.
Had the club had any reservations as to the collection of the credit, it should have raised it
there and then, but it failed to do so. As such, it generated on the player the legitimate
expectation that the club did not oppose paying the entire credit at the time due to
Claimant.
pg. 20
REF. FPSD-10615
80. The DRC equally found that this demonstrates, together with the absence of any other
evidence to the contrary, that the Agreement of Recession is valid. While the Chamber was
unimpressed by the behaviour of the player adequately communicating the cancellation of
the Credit Assignment Letter, it was equally unimpressed by the absence of any reply to
the default notice by the club, as well as of its failure to make the payment in a timely
manner – even if those were addressed to the Company on the grounds of the Credit
Assignment Letter.
81. This confirms, so found the DRC, that the player has standing to sue and that the amounts
claimed should have been paid to him per the Second Agreement. It equally confirms that
there is no risk of double payment as raised by the club, since the credit belongs entirely
to the player and not to Brio.
82. Lastly, the DRC turned to the issue of the penalty/acceleration clause. Given the above
conclusions, it decided, in line with the jurisprudence of the Football Tribunal, that the
criteria established therein is met and therefore the amounts due as penalty and interest
must be granted to the player.
83. As a consequence, and in accordance with the general legal principle of pacta sunt servanda,
the Chamber decided to award the player the amounts requested, however with interest
rates applying as of the date of the claim due to the behaviour of the player as highlighted
above, as follows:
- USD 336,075 as outstanding remuneration plus 5% interest p.a. as from 19 June 2023 until
the date of effective payment; and
- USD 33,607.50 as penalty fee.
84. Lastly, the DRC deemed that the assignment of credits performed by the player might
constitute a circumvention of the third-party ownership rule as defined by art. 18ter of the
Regulations. Accordingly, it decided that the case file should be forwarded to the FIFA
Regulatory Enforcement Department for further investigation and appropriate action, if
necessary.
ii. Compliance with monetary decisions
85. Finally, taking into account the applicable Regulations, the Chamber 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.
86. In this regard, the DRC 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
pg. 21
REF. FPSD-10615
maximum duration of the registration ban shall be of up to three entire and consecutive
registration periods.
87. Therefore, bearing in mind the above, the DRC 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.
88. 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.
89. The DRC 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.
d. Costs
90. 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 agent,
or match agent”. Accordingly, the Chamber decided that no procedural costs were to be
imposed on the parties.
91. 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.
92. Lastly, the DRC concluded its deliberations by rejecting any other requests for relief made
by any of the parties.
pg. 22
REF. FPSD-10615
IV. Decision of the Dispute Resolution Chamber
1.
The Football Tribunal has jurisdiction to hear the claim of the Claimant, Dylan Felipe Borrero
Caicedo.
2.
The claim of the Claimant is partially accepted.
3.
The Respondent, Clube Atlético Mineiro, must pay to the Claimant the following amount(s):
- USD 336,075 as outstanding remuneration plus 5% interest p.a. as from 19 June 2023
until the date of effective payment;
- USD 33,607.50 as penalty fee.
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.
6.
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.
7.
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.
8.
This decision is rendered without costs.
For the Football Tribunal:
Emilio García Silvero
Chief Legal & Compliance Officer
pg. 23
REF. FPSD-10615
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
Fédération Internationale de Football Association
FIFA-Strasse 20 P.O. Box 8044 Zurich Switzerland
www.fifa.com | legal.fifa.com | [email protected] | T: +41 (0)43 222 7777
pg. 24