Labour Disputes
Texto da decisão
REF. FPSD-13465
Decision of the
Dispute Resolution Chamber
passed on 22 April 2024
regarding an employment-related dispute concerning
the player Diego Falcinelli
COMPOSITION:
Lívia SILVA KÄGI (Brazil & Switzerland), Deputy Chairwoman
André DOS SANTOS MEGALE (Brazil), member
Michele COLUCCI (Italy), member
CLAIMANT:
Diego Falcinelli, Italy
Represented by Alessandro Cerruti
RESPONDENT:
Crvena Zvezda, Serbia
Represented by Davor Radić
pg. 2
REF. FPSD-13465
I. Facts of the case
1.
The parties to the present dispute are:
-
the Italian player, Diego Falcinelli (hereinafter: the Player or the Claimant); and
-
the Serbian club, FK Crvena Zvezda (hereinafter: the Club or the Respondent).
2.
On 10 September 2020, the Player and the Club concluded an employment contract
(hereinafter: the Contract). The Contract was valid as from the date of signature until 30
June 2022; however, the Club had an option to terminate the Contract until 15th of July
2021.
3.
Clause 3.1 of the Contract reads as follows:
“The Club is obliged to pay the amounts as agreed below to the Player in return of his
services subject to this Agreement. The Parties expressly and irrevocably agree that all
the payments related to salaries and/or fees and/or bonuses reported below in this
Agreement are "net" payments and all the taxes in connection with payments of
salaries and/or fees and/or bonuses in this Contract in accordance with the Serbian
tax legislation shall be paid by the Club in addition to the amounts stipulated in this
Contract. The professional football player shall pay annual tax for personal income
based on the decision of the competent tax administration of the Republic of Serbia.
However, the Club undertakes to refund the annual tax for personal income paid by
the player from the presentation of the relevant receipts to the player within 60 days
of presentation of the receipts that are the evidences of the payments performances
executed by the Player.
The Club shall not be held liable for any payments due to the tax authorities outside
of Serbia be it during or after the termination or expiry of the employment relationship
between the Club and the Player.
[…]”
4.
Clause 3.2. of the Contract reads as follows:
“The following bonuses shall accrue during the life of this contract and concern every
single and separate season during which the Contract is in force.
The Parties expressly and irrevocably agree that all the payments referred to the
bonuses below are "net" payments. For the avoidance of any doubt, the Club shall be
the sole and exclusive responsible for every kind of taxes and deductions of any nature
accrued in connection with payments referred to the bonuses in accordance with the
Serbian Tax legislation.
pg. 3
REF. FPSD-13465
The professional football player shall pay annual tax for personal income based on
the decision of the competent tax administration of the Republic of Serbia. However,
the Club undertakes to refund the annual tax for personal income paid by the player
from the presentation of the relevant receipts to the player within 60 days of
presentation of the receipts that are the evidences of the payments performances
executed by the Player”.
5.
Clause 5 of the Contract reads as follows:
“The Parties agree that all the amounts in this agreement be it fixed payments and/or
performance bonuses represent net amounts, which will be paid to the Player in the
local currency (Serbian Dinar) and this at the middle exchange rate of the National
Bank of Serbia valid on the date of payment. Based on this amount in local currency,
the Club shall calculate and pay the due income taxes in accordance with article 84a
of the Law on Personal Income tax in Serbia.
The professional player shall pay annual tax for personal income based on the
decision of the competent tax administration of the Republic of Serbia. However, the
club undertakes to refund the anual tax for personal income paid by the player upon
presentation of the relevant receipts to the player within 60 days of presentation of
the receipts that are the evidences of the payments performaces executed by the
player.
The Club shall not be held liable for any payments due to the tax authorities outside
of Serbia be it during or after the termination or expiry of the employment relationship
between the Club and the Player.”
6.
On 16 July 2021, the Player sent a termination notice to the Club.
7.
Between October and December 2021, the legal representatives of the Player and the Club
held various communications in order to conclude a settlement agreement. In particular,
the correspondence sent by the legal representative of the Player to the Club on 23
November 2021 indicated the following:
“Allow me to submit to Your kind attention the following ultimate proposal, taking into
due consideration the conversation Mr. Falcinelli had a few minutes ago with Your
Club’s management and Mr. Ivan Pavlovic.
a. 45,000 Euro within and not after the 30th November 2021
b.45,000 Euro within and not after the 31st December 2021
c. 40,000 Euro within and not after the 28th February 2022
d.40,000 Euro within and not after the 31st March 2022
e.200,000 Euro within and not after the 30th April 2022
f. 65,000 Euro within and not after the 31st July 2022
g. 65,500 Euro within and not after the 30th September 2022
pg. 4
REF. FPSD-13465
All the aforementioned sums are to be considered as net ones, as per the Player’s
loan/employment agreement’s contents. […]”.
8.
On 26 November 2021, the Player and the Club concluded a settlement agreement
(hereinafter: the settlement agreement).
9.
Clause 3.3. of the settlement agreement reads as follows:
“The Parties have agreed that a Final Settlement in the amount of EUR 500,500 (five
hundred thousand five hundred) Euro net shall bepaid to the Player by the Club via
bank transfer as per the below agreed payment plan:
•
1st installment: Euro 37,500 (thirty seven thousand five hundred) net via bank
transfer within and not after 10 calendar days elapsing from the Signature Date
of the Agreement (26th November 2021)
•
2nd installment: 37,500 (thirty seven thousand five hundred) net via bank transfer
within and not after the 31st December 2021
•
3rd installment: 40,000 (forty thousand) net via bank transfer within and not after
the 28th February 2022
•
4th installment: 40,000 (forty thousand) Euro net via bank transfer within and not
after the 31st March 2022
•
5th installment: 200,000 (two hundred thousand) Euro net via bank transfer within
and not after the 30th April 2022
•
6th installment: 72,500 (seventy-two thousand five hundred) Euro net via bank
transfer within and not after the 31st of July 2022
•
7th installment: 73,000 (seventy-three thousand) Euro net via bank transfer within
and not after the 30th September 2022.”
10. Clause 3.5 of the settlement agreement reads as follows:
“The Player hereby confirm that the above Final Settlement, once entirely paid by the
Club, in addition to all the sums paid to the Player to the date under the Employment
Contract, constitutes and fully satisfied all its financial rights arising from and relating
to the Employment Contract, in full and final settlement that it has no further payment
claims against the Club and/or its employees and/or its agents arising from and
relating to the Employment Agreement.”
11. Clause 6 of the settlement agreement reads as follows:
pg. 5
REF. FPSD-13465
“Each Party shall bear its own costs that they have occurred or will occur in relation
the negotiation and execution of this Agreement (including but not limited to all type
of legal fees and costs).”
12. Clause 3.8 of the settlement agreement reads as follows:
“This Agreement constitutes the entire agreement between the Parties hereto relating
to the subject matter hereof and supersedes any previous agreements or
understandings and there are no oral or written understanding, representations or
commitments of any kind, express or implied, which are not expressly set forth herein.
The invalidity or unenforceability of any portion or provision of this Agreement shall
not affect the validity or enforceability of any other portion or provision. Any invalid
or unenforceable portion or provision shall be deemed severed from this Settlement
Agreement.”
13. On 30 March 2022, the parties signed an annex to the settlement agreement (hereinafter:
the annex).
14. The annex reads inter alia as follows:
“Whereas
[…]
B. The Parties entered into the "FINAL SETTLEMENT AGREEMENT" No. 124/F on the 26th
of November 2021 amicably agreeing on the settlement of outstanding debt of EUR
500,500 (five hundred thousand five hundred Euro) toward the Player, in 7
installments, out of which the Club has repaid first three installments, and the next,
fourth installment in the amount of EUR 40,000 (forty thousand euro net) is falling due
on 31 st March 2022, with the outstanding debt on the date of Annex I signing being
EUR 385,500 (three hundred eighty-five thousand five hundred Euro)
NOW THEREFORE, in consideration of the mutual covenants and agreements set forth
herein and for other good and valuable consideration, receipt and sufficiency of which
is hereby acknowledged, the Parties hereby agree as follows:
To amend Article III. Objective, point 3, extending the deadline for payment of the
fourth installment by 10th of April, 2022, without activation of point 4 of the same
Article.
Namely:
I. The Parties hereby agree that a Final Settlement of the outstanding debt as at 30th
of March, 2022 in the amount of EUR 385,500 (three hundred eighty-five thousand five
hundred Euro) net shall be paid to the Player by the Club via bank transfer as per the
below agreed payment plan:
pg. 6
REF. FPSD-13465
•
4th installment: 40,000 (forty thousand) Euro net via bank transfer by 10th
April 2022
•
5th installment: 200,000 (two hundred thousand) Euro net via bank transfer
within and not after the 30th April 2022
•
6th installment: 72,500 (seventy-two thousand five hundred) Euro net via bank
transfer within and not after the 30th April 2022
•
7th installment: 73,000 (seventy-three thousand) Euro net via bank transfer
within and not after the 30th September 2022
All other terms and conditions of the Final Settlement Agreement shall remain in force
and without any change thereof.”
15. On 11 July 2023, the legal representative of the Player sent the following correspondence
to a Club’s representative:
“Following our conversation, kindly find attached the exercise, elaborated by Mr.
Falcinelli's Accountant, with regard to the taxes to be paid in Italy on the outstanding
amounts liquidated by [the Club] in the year 2022 to the Player as a consequence of
the Settlement Agreement duly concluded and signed by the Parties on the 26th of
November 2021 (kindly find it attached)
As You may see , the relevant instalments are supposed to be paid as net ones, since
the ratio of the settlement agreement was to ensure the Player to integrally receive
the net amounts due and not liquidated on time by the [the Club]. On the other hand,
by agreeing upon a retarded liquidation of the outstanding emoluments, the player
intended to meet the needs of the Club with regard to their liquidity issues.
If the Player had regularly received on time the amounts due as per his original
contract with the Club, his salary would have been subjected to the Serbian taxation.
Unfortunately, the non-fulfilment of the Club's obligations has caused Mr. Falcinelli to
receive the majority of the outstanding amounts while resident in Italy, thus subjected
to the Italian taxation. In the attached excel file you may notice that a theorical 12.5%
has been used as tax rate paid by the Club in Serbia on the liquidated instalments,
therefore the amount of 175.520,80 Euro is the extra amount the player is required to
pay to the Italian tax authority. This amount raises up to 322.782,25 Euro, as the
Player shall be compelled to pay the taxes on the aforementioned difference, as any
sum now liquidated by [the Club] would be considered as a salary by the Italian Tax
Authority, hence subjected to the Italian taxation.
Kindly note that the Player is compelled to pay the taxes linked to the year 2022 within
pg. 7
REF. FPSD-13465
and not after the 30th of July 2023 and that, in any case, [the Club] has paid with
significative delays most of the instalments agreed upon in the Settlement Agreement.”
16. On 28 July 2023, the Club replied to the Player the following:
“Regarding your letter that you sent us on 11 July 2023 we must inform you that in
accordance with our contractual relationship with the player Diego Falcinelli we as a
club are not obligated to pay this tax amount from Italy that you requested from us.
This is all because in article 3, article 4 and article 5 of the Agreement no. P 220 on
player remuneration during the loan period and contractual promise regarding
Professional player contract on 10 September 2020 (attached) we agreed with the
player Diego Falcinelli as follows:
”The Club shall not be held liable for any payments due to the tax authorities outside
of Serbia be it during or after the termination or expiry of the employment relationship
between Club and the Player.”
It is true that on 26 November 2021 we signed with the player Diego Falcinelli the Final
Settlement Agreement (attached) and that on 30 March 2022 we signed with the player
Diego Falcinelli the Annex I to the final settlement agreement (attached). All financial
amounts from both agreements are based on the “main” Agreement on 10 September
2020 and which document parties in the Final settlement agreement on 26 November
2021 called ”employment contract”.
Based on the above and in connection to the agreement between the parties from the
Employment contract of 10 September 2020 it is clear that club FK Crvena Zvezda have
no obligation to pay any tax for the player Diego Falcinelli to the Italian Tax Authority.
As parties agreed, club FK Crvena Zvezda and player Diego Falcinelli, the club shall not
be held liable for any payments due to the tax authorities outside of Serbia after or
expiry of the employment relationship between club and the player.
One of the most important and fundamental general principle in the football law is
for sure pacta sunt servanda so in accordance with the agreement between the
parties, my client-club FK Crvena Zvezda and your client-player Diego Falcinelli, we
must dismiss in entirety your request for paying this tax for the player to the Italian
Tax Authority because that is not contractual obligation of the club FK Crvena Zvezda.”
17. On 7 December 2023, the Player sent a default notice to the Club and requesting payment
of EUR 388,519.83 corresponding to the reimbursement of taxes as per the settlement
agreement and the annex, setting a deadline of 15 days.
pg. 8
REF. FPSD-13465
II. Proceedings before FIFA
18. On 24 January 2024, the Claimant 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
19. The Claimant requesting the payment of EUR 388,519.83 corresponding to the
reimbursement of the payment of the Italian taxes in accordance with the settlement
agreement and the annex.
20. In this respect, the Player mentioned that “in the Final settlement agreement the former link
to the Serbian tax legislation and the waiver in favor of the Club towards any foreign tax
implications/claims, contained in the Agreement No. P2204, were expressly removed and no
referral to a specific tax legislation was inserted.” This was because the Player would move to
different countries and that the tax obligations may differ from one country to another,
and therefore, the parties agreed upon to rely on the net amounts with no further
specifications.
21. The Player continued to explain that in the year 2022 he was a permanent resident in Italy
and consequently, all the relevant payments should have been done in accordance with
the Italian tax legislation. Therefore, the Respondent is liable to reimburse the Italian taxes
paid by the Player. In particular, the Player mentioned that he has already paid the amount
EUR 211,266.90, via 6 bank transfers which amounted to EUR 207,945.07. However, from
that amount the Player has benefited of a tax deduction of EUR 3,321.83 related to personal
expenses.
22. Furthermore, the Player indicated that the request of reimbursement of taxes in the
amount of EUR 211,266.90 would be considered by the Italian tax authorities as a new
salary, and therefore, he would be in the obligation to pay additional taxes. Therefore, and
in application of the overall tax rate applicable to the Player’s income (45.63%), the
additional would amount to EUR 177,252.93. Indeed, the Player mentioned that this
payment is linked to a future payment, however, he considered that he managed to clearly
highlight the foundations of his petitum, the laws and regulations that justify it.
23. Finally, the player concluded that:
“The roots of this Case are to be found in the repeated delays of the Club in fulfilling
its pecuniary obligation. In fact, if the Club had fulfilled on time its pecuniary
obligation towards the Player, as per the Agreement No. P220, and/or if the Player
received the entirety of the outstanding amounts within the 31st of December 2021,
the Player would have not be considered as an Italian resident: it is undisputed that
the non-fulfilment on time of the Club’s obligations must not cause detrimental
pg. 9
REF. FPSD-13465
consequences to the Player, who has the right to fully perceive the net amounts agreed
upon with the Club.”
24. In support to his claim, the Claimant presented inter alia the following documents:
-
Player’s 2022 tax declaration in Italy;
Prove of delivery of the tax declaration;
Residence’s certificate;
Calculation of the taxes;
Italian tax laws and Regulations;
Payments performed to the Italian Tax Authority.
25. The Player requested the following relief:
“To compel the Club to immediately pay to the Player the gross amount of Euro
388,519.83 (three hundred eighty-eight thousand five hundred nineteen Euro and
eighty three cents) or, subordinately, the net amount of Euro 211,266.90 (two hundred
eleven thousand two hundred sixty six Euro and ninety cents);
- in addition, in accordance with the constant jurisprudence of the DRC, to compel the
Club to pay an interest rate of 5% (five pc), to be calculated on an annual basis, for
each day of delay elapsing from the notification of DRC’s decision”.
b. Position of the Respondent
26. In its reply, the Respondent contested the jurisdiction of FIFA. The Club argued that FIFA's
deciding bodies are not competent to deal with tax-related disputes. Additionally, the Club
claimed that it “never make any (written or oral) agreement with the Claimant from which he
obligate pay his tax obligation outside of Serbia and especially in Italy ; the Parties (Claimant
and Respondent) in their employment agreement of 10 September 2020 expressly agreed that
Respondent shall not be held liable for any payments due to the tax authorities outside of Serbia
be it during or after the termination or expiry of the employment relationship between the
Respondent and Claimant (see article 3.1 paragraph 2 and article 5 paragraph 3 of the
employment agreement)”. Therefore, the Club considered that the case is inadmissible due
to the lack of jurisdiction of FIFA.
27. Subsidiarily, as to the merits, the Respondent stressed that (i) it never participated in the
procedure of the Player’s taxes and therefore the entire procedure is contested by the
Respondent; and (ii) all the documents are private documents and there was not a decision
from the tax administration “ from the Italian Tax Authority against Respondent which means
that this claim represent a bed attempt «to take» a money from the Respondent that does not
belong it at all because the Claimant and Respondent in their employment agreement agreed
pg. 10
REF. FPSD-13465
that Respondent shall not be held liable for any payments due to the tax authorities outside of
Serbia be it during or after the termination or expiry of the employment relationship between
the Respondent and Claimant (see article 3.1 paragraph 2 and article 5 paragraph 3 of the
employment agreement).
28. Finally, the Club emphasized that FIFA should not deviate from the intention of the parties
and should follow the principle of pacta sunt servanda, and that in accordance with clauses
3.1 and article 5.3 of the Contract the parties agreed that the Respondent shall not be held
liable for any payment due to the tax authorities outside of Serbia. Therefore, the
Respondent requested FIFA, in case it accepts the jurisdiction, to reject the claim.
29. It is to be noted that the Respondent provided the bank payments performed in favour of
the Claimant.
30. The Respondent requested the following relief:
“1. The claim of the Claimant, Mr. Diego Falcinelli, is inadmissible.
2. All costs of these proceedings shall be charged to the Claimant.
and, alternatively request of the Respondent in the case if FIFA decide that this claim
is not inadmissible:
1. The Claim of the Claimant, Mr. Diego Falcinelli shall be rejected in full.
2. All costs of these proceedings shall be charged to the Claimant.”
c. Rejoinder of the Claimant
31. In his rejoinder, the Claimant stressed that the present case arises from the Contract and
the settlement agreement, since the latter referred to net amounts and therefore, FIFA has
jurisdiction to hear the dispute.
32. As to the reference of clauses 3.1 and 5 of the Contract, the Player indicated that by signing
the settlement agreement, the Contract was “objectively novated, thus is no longer productive
of legal effects and binding between the parties” (cf. clause 3.8 of the settlement agreement).
33. The settlement agreement did not content the information reported in clauses 3.1, 3.2 and
5 of the Contract, as it was expressly excluded in order to guarantee that the Player receives
the amount of EUR 500,500 and therefore, the parties opted to include the wording “net”.
34. As to the evidence contested by the Club, the Player requested the Respondent through
technical analysis to corroborate that the evidence provide was not authentic or truthful.
pg. 11
REF. FPSD-13465
Finally, as to the non-involvement of the Club, he mentioned that the procedure before the
Italian tax authority only involves the Player and the tax authorities.
d. Final comments of the Respondent
35. In its final comments, the Respondent indicated the following:
-
The present case is solely a tax matter and not connected to the rights and
obligations of the parties to the Contract.
-
Clause 5.3 of the Contract indicated that the Club shall not be liable to pay taxes
outside Serbia.
-
The settlement agreement was agreed on the basis of outstanding remuneration
established in the Contract. The wording of the settlement agreement only included
the word “net” but without any additional words for the tax, thus, the Club never
replaced the content of the Contract with the signature of the settlement agreement.
-
The Club referred to the communications held between the parties when preparing
the settlement agreement and wished to highlight that the clause 8 was prepared
and wrote by the Player and not the Club.
36. Then, the Claimant referred to the following:
“Article 18 of the Swiss Code of Obligations, the parties’ common intention must
prevail on the wording of their contract. If this common intention cannot be
determined with certainty based on the wording, the judge must examine and
interpret the formal agreement between the parties in order to define their subjective
common intention. This interpretation will first take into account the ordinary sense
one can give to the expressions used by the parties and how they could reasonably
understand them. The behavior of the parties, their 12espective interest in the contract
and its goal can also be taken into account as complementary means of
interpretation. […]
In terms of above communications (negotiations) between the parties, the Player and
his legal representative never mentioned or wrote to the Club anything about the tax
payment in Italy (what he claimed now in this dispute) and that it is clear from all
correspondence between the parties that we sent with this submission. In addition,
that Player prepared and wrote this Final Settlement Agreement as well article 8 of
this Agreement, not the Club.
Furthermore, Club point out that during negotiations about the signature of the Final
Settlement Agreement the Player never requested to put and write any provision about
the tax payment in Italy regarding this outstanding remuneration that parties agreed
pg. 12
REF. FPSD-13465
in the Final Settlement Agreement, the matter was neither discussed between the
Parties, nor inserted as a provision in the Final Settlement Agreement – who wrote
legal representative of the Player and not Club.
The Club notes that the Final Settlement Agreement on 26 November 2021 neither
contains a definition of the term “net”, nor contains any provision regarding possible
reimbursement by the Club or any taxes or other expensed incurred by the Player and
originating from the employment relationship.”
37. In view of the foregoing the Respondent concluded that the claim is inadmissible.
pg. 13
REF. FPSD-13465
III. Considerations of the Dispute Resolution Chamber
a. Competence and applicable legal framework
38. 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 24 January 2024 and submitted
for decision on 22 April 2024. Taking into account the wording of art. 34 of the February
2024 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.
39. 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 Regulations on the Status and Transfer of Players (February 2024 edition), the
Dispute Resolution Chamber is in principle competent to deal with the matter at stake,
which concerns an employment-related dispute with an international dimension between
an Italian player and a Serbian club.
40. However, the Chamber acknowledged the Respondent’s opinion that FIFA does not have
jurisdiction considering that (i) the present case is related to tax issues only, and (ii) the
Contract clearly stipulated that it would not be liable to pay taxes outside Serbia. On the
other hand, the Claimant indicated that FIFA has jurisdiction considering that his request
is based on the Contract and the settlement agreement.
41. For the sake of clarity, the Chamber first of all wished to stress that FIFA’s deciding bodies
are in principle not competent to deal with purely tax relate disputes, as they fall outside
the scope of the Regulations on the Status and Transfer of Players and Procedural Rules
unless the claim in relation to the taxes appears to be contractually grounded.
42. In this regard, the Chamber observed that the settlement agreement and annex referred
to the payment of amounts in “net”. The Chamber also observed that although referring to
taxation, is in fact an employment-related contractual dispute, insofar the legal matter to
be analysed is to establish whether the Player should have received his remuneration net.
43. On this point, the Chamber recalled the latest edition of the Commentary on the
Regulations on the Status and Transfer of Players which stipulates that “whenever the origin
of a dispute lies within the contractual employment relationship between a player and their club,
i.e. whenever the relevant employment contract serves as the legal basis for the claim between
the parties, it can be assumed that the dispute is “employment-related” within the meaning of
article 22 paragraph 1 b), Regulations” ( p. 460)
44. The reimbursement of the tax claimed by the Player concerns the settlement agreement
between the parties and therefore its interpretation. On account of the above, the
pg. 14
REF. FPSD-13465
Chamber established that the claim is employment-related in the sense of art. 22 lit. b) of
the Regulations on the Status and Transfer of Players. As such, it dismissed the position of
the club in this respect.
45. 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 (February 2024 edition), and
considering that the present claim was lodged on 24 January 2024, the May 2023 edition of
said regulations (hereinafter: the Regulations) is applicable to the matter at hand as to the
substance.
b. Burden of proof
46. 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
47. 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
48. 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 liability of the
Respondent for the Claimant’s taxes in Italy under the settlement agreement and its annex.
49. In this context, the Chamber acknowledged that its task was to determine whether the
Respondent could, indeed, be held liable to reimburse to the Claimant costs incurred on
the basis of income tax, pursuant to the provisions contained in the settlement agreement
relating to the payment of the Claimant’s remuneration.
50. As a preliminary remark, the Chamber observed that the Claimant made a request of two
different amounts (i) EUR 211,266.90 for the taxes already paid and (ii) EUR 177,252.93 for
pg. 15
REF. FPSD-13465
the taxes that would be applied on the Player once the reimbursement of EUR 211,266.90
would occur.
51. In this respect, as to the first amount EUR 211,266.90, the Chamber first recalled the
Claimant’s argument that the amounts stipulated under the settlement agreement and its
Annex are described as “net”, and that, as such, the Respondent holds the responsibility of
paying all tax-related expenses in Italy in relation to the Claimant’s salary. As the Claimant
paid those amounts himself, he requested reimbursement thereof. Moreover, he
mentioned that the settlement agreement superseded the contract and therefore, “the
contract was objectively novated”.
52. Similarly, the Chamber took note that the Respondent contested that it is liable to pay the
Claimant’s taxes, based on the fact that it had remitted the salaries stipulated under the
settlement agreement and its annex and that in accordance with the Contract (clause 3.1,
3.2 and 5) the Club is not responsible to pay taxes outside Serbia and that the amounts
stipulated in the settlement agreement are based on the Contract. Moreover, the
settlement agreement only indicated the wording “net”, however it did not mention the
payment of taxes.
53. Before evaluating the arguments and evidence on file, the Chamber recalled the wording
of art. 13 par. 5 of the Procedural Rules, which stipulate that parties claiming a right on the
basis of an alleged fact bear the burden of proving it.
54. In this context, having carefully analysed the evidence provided by the parties in the
proceedings at hand, the Chamber firstly wished to point out that the provisions of the
settlement agreement and its annex referred very briefly to the payment of the
remuneration, and stressed that, whilst on one hand, it was indeed specified in clauses 3
of the settlement agreement that the remuneration payable to the Claimant should be
considered “net”, there were no provisions referring to the payment of any applicable tax.
55. Beyond this, the Chamber observed that although the settlement agreement superseded
the Contract, the amounts to be paid were based on the latter and that the Contract clearly
mentioned that the Club was not responsible to pay taxes abroad (cf. clause 3.1 3.2 and 5).
Therefore, the Chamber stressed that if the intention of the parties was that the Club
should be liable to pay the taxes regardless of the residence of the player, this should have
been stated in the settlement agreement, but no indication was found. Accordingly, the
Chamber was of the opinion that the interpretation of “net” under the settlement
agreement followed from the good faith analysis of the true intention of the parties
expressed in the Contract.
56. Based on the above, the Chamber established that the Respondent acted in accordance
with the settlement agreement as it remained uncontested that the salaries stipulated
thereunder were paid fully in accordance therewith, and that no specific tax liability could
pg. 16
REF. FPSD-13465
be raised from the provisions of the mentioned settlement and application of Italian tax
law.
57. As a final remark, the Chamber observed that the Claimant provided no evidence to
potentially demonstrate that the former had otherwise accepted the responsibility to pay
the Claimant’s Italian taxes, separately from the settlement agreement, which further
confirmed the Chamber’s conclusions outlined above.
58. Based on the above, the Chamber concluded that the Claimant failed to meet the burden
of proving that he is entitled to reimbursement of his tax bill, in accordance with art. 13
par. 5 of the Procedural Rules.
59. Therefore, the Chamber decided to reject the claim.
60. As to the second amount, EUR 177,252.93, the Chamber noted that this was a hypothetical
amount subject to the reimbursement of the taxes. In this regard, the Chamber remarked
that since the above payments were not yet paid and that the request of reimbursement
is rejected, it appears that the Claimant has not incurred any tax liabilities and would not
incur in the payment of additional taxes. Hence, while any ruling on the alleged taxes of
EUR 177,252.93 is premature at this point, the Chamber felt compelled that its assessment
would remain identical for this part of the claim.
d. Costs
61. 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.
62. 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.
63. Lastly, the DRC concluded its deliberations by rejecting any other requests for relief made
by any of the parties.
pg. 17
REF. FPSD-13465
IV. Decision of the Dispute Resolution Chamber
1.
The Football Tribunal has jurisdiction to hear the claim of the claimant, Diego Falcinelli.
2.
The claim of the Claimant, Diego Falcinelli, is rejected.
3.
This decision is rendered without costs.
For the Football Tribunal:
Emilio García Silvero
Chief Legal & Compliance Officer
pg. 18
REF. FPSD-13465
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. 19