Labour Disputes
Texto da decisão
REF. FPSD-11727
Decision of the
Dispute Resolution Chamber
passed on 8 February 2024
regarding an employment-related dispute concerning the player John Okoli
COMPOSITION:
Frans DE WEGER (the Netherlands), Chairperson
Stijn BOEYKENS (Belgium), Member
Andre DOS SANTOS MEGALE (Brazil), Member
CLAIMANT / COUNTER-RESPONDENT:
John Okoli, Nigeria
Represented by Talat Emre Kocak
RESPONDENT / COUNTERCLAIMANT:
Arab Contractors, Egypt
INTERVENING PARTY:
Al Swehli, Libya
pg. 2
REF. FPSD-11727
I. Facts of the case
1.
On 6 October 2021, the Nigerian player John Okoli (hereinafter: Player or Claimant) and
the Egyptian club Arab Contractors (hereinafter: Club or Respondent), concluded an
employment contract valid for three seasons i.e., 2021/2022, 2022/2023 and 2023/2024
(hereinafter: Employment Contract).
2.
Pursuant to clause 2 of the Employment Contract, the Club undertook to pay to the Player
the following amounts:
•
Season 2021/2022: total amount of USD 150,000, payable as follows:
o
o
o
o
o
o
o
o
o
o
o
•
Season 2022/2023: total amount of USD 157,500, payable as follows:
o
o
o
o
o
o
o
o
o
o
•
USD 100,000 on 1 November 2021;
USD 5,000 on 1 December 2021;
USD 5,000 on 1 January 2022;
USD 5,000 on 1 February 2022;
USD 5,000 on 1 March 2022;
USD 5,000 on 1 April 2022;
USD 5,000 on 1 May 2022;
USD 5,000 on 1 June 2022;
USD 5,000 on 1 July 2022;
USD 5,000 on 1 August 2022;
USD 5,000 on 1 September 2022.
USD 15,750 on 1 October 2022;
USD 15,750 on 1 November 2022;
USD 15,750 on 1 December 2022;
USD 15,750 on 1 January 2023;
USD 15,750 on 1 February 2023;
USD 15,750 on 1 March 2023;
USD 15,750 on 1 April 2023;
USD 15,750 on 1 May 2023;
USD 15,750 on 1 June 2023;
USD 15,750 on 1 July 2023.
Season 2023/2024: total amount of USD 165,000, payable as follows:
o
o
o
o
USD 16,500 on 1 September 2023;
USD 16,500 on 1 October 2023;
USD 16,500 on 1 November 2023;
USD 16,500 on 1 December 2023;
pg. 3
REF. FPSD-11727
o
o
o
o
o
o
3.
USD 16,500 on 1 January 2024;
USD 16,500 on 1 February 2024;
USD 16,500 on 1 March 2024;
USD 16,500 on 1 April 2024;
USD 16,500 on 1 May 2024;
USD 16,500 on 1 June 2024.
Clause 4, par. 6 of the Employment Contract reads as follows:
“6. The player should bear the taxes of this contract and other remuneration according
to the law, the club shall deduct taxes from the player dues and transfer them to the
taxes under his responsibility”.
4.
Furthermore, the additional provisions of the Employment Contract read inter alia as
follows:
“6. The player will be paid USD 30,000 if he scores twenty goals after the end of each
season.
7. The player will be paid USD 50,000 at the end of the 2021-2022 season if he actually
participates in matches.
8. The player will be paid USD 52,500 at the end of the 2022-2023 season if he actually
participates in matches.
9. The player will be paid USD 55,000 at the end of the 2023-2024 season if he actually
participates in matches”.
5.
In accordance with the information retrieved from the FIFA Transfer Matching System
(TMS), the sporting seasons in Egypt are defined as follows:
•
Season 2021/2022: 25 September 2021 – 30 August 2022.
•
Season 2022/2023: 15 October 2022 – 25 July 2023.
•
Season 2023/2024: 27 July 2023 – 30 July 2024.
6.
On 3 August 2022, the Player put the Club in default and requested payment of USD
15,000, corresponding to his salaries of June, July, and August 2022.
7.
On 6 July 2023, the Player flew from Cairo (Egypt) to Lagos (Nigeria). The flight tickets were
issued by the Club, with a return schedule for 6 August 2023.
pg. 4
REF. FPSD-11727
8.
On 18 July 2023, the Player put the Club in default for payment of USD 128,250,
corresponding to outstanding salaries (USD 12,750 for the 2021/2022 season plus USD
63,000) and bonus (USD 52,500). He granted the Club with a 15 days’ deadline under
penalty of termination of the Employment Contract.
9.
On 1 August 2023, the Player sent the Club a second warning and informed that if the
payment was not completed until the following day, he would become entitled to
terminate the Employment Contract with just cause.
10.
Also on 1 August 2023, the Club replied to the Player’s letter. Contextually, it stated inter
alia that:
•
all the payments for the season 2021/2022 had already been made;
•
the Player would be liable to a 10% deduction of his entitlements in line with the
Club’s regulations governing contracts, however such deduction was waived in good
faith. According to the Club, such provision from its regulations reads as follows:
“10% of the net contract is deducted for each player in the case of nonachievement of a position from first to fourth position in the general ranking
of the Premier League at end of the season, deducted from percent of 25%
(the participation percent) & End. / Member of Board of Directors – the
football General Supervision has the right to increase, decrease or exempt
any player from the deduction percent”.
•
the amounts stipulated in the Employment Contract were gross, hence deductible
of the corresponding taxes;
•
the only outstanding amount was the salary of July 2023, which was supposed to be
paid to the Player in person, however, only recently the Player requested it was paid
via wire transfer; and
•
there were still matches of the Egyptian Premier League to be played, hence any
request for bonus was still premature and would be settled in due course.
Furthermore, the Club was in the process of contacting the Egyptian Football
Association (EFA) to confirm the number of matches played by the Player.
11.
On 8 August 2023, the Player notified the Club of the termination of the Employment
Contract due to overdue payables.
12.
On 16 August 2023, the Club contacted the Player via email and stated as follows (quoted
verbatim):
“Mr John
pg. 5
REF. FPSD-11727
We inform you that the preparation has started on August 12, 2023, and we have sent
you the entry visa to you, and we have learned that you have already received it, so we
ask you to come to join the team’s training because this is considered absent from the
training, please let us know the date of your arrival for coordination and we are waiting
for you.
Attached is a copy of the visa”.
13.
On 18 August 2023, the Club insisted on his request for the Player to avail himself at its
premises. Contextually, the Club acknowledged that no reply had been received, let alone
information concerning the Player’s whereabouts. It furthermore requested the Player to
provide it with the corresponding details of his arrival in the country.
14.
On 20 August 2023, the Player entered into a new contract with the Libyan club, Al Swehli
(hereinafter: Al Swehli or Intervening Party) valid as from 29 August 2023 until 27 August
2025. Accordingly, the Player would be entitled to a total remuneration of USD 850,000,
payable as follows:
•
USD 200,000 as advanced payment upon signature of the contract;
•
USD 200,000 payable in 12 monthly instalments during the season 2023/2024;
•
USD 200,000 payable with the start of the season 2024/2025; and
•
USD 250,000 payable in 12 monthly instalments during the season 2024/2025.
15.
On 22 August 2023, the Club contacted the Player once again and inter alia reiterated his
report of absence and the request for information.
16.
On 28 August 2023, the Player replied to the Club and confirmed that the Employment
Contract had been terminated. Consequently, the Player stated that he would no longer
attend the Club’s training sessions.
17.
In accordance with the information available in TMS:
•
on 30 August 2023, Al Swehli entered a transfer instruction to engage the Player
permanently as out of contract (TMS no. 734297);
•
on 31 August 2023, the Libyan Football Federation (LFF) requested the Player’s
International Transfer Certificate (ITC);
•
on 3 September 2023, the EFA rejected the ITC request on the grounds that “the
contract between the former club and the professional player has not expired”;
pg. 6
REF. FPSD-11727
18.
•
on 4 September 2023, the LFF disputed the rejection of the Player’s ITC and
requested FIFA’s intervention for his registration;
•
on 5 September 2023, the FIFA Players’ Status Chamber (PSC) granted the LFF’s
request to register the Player. Such decision expressly stated that it was “without
prejudice to any possible decision from the FIFA Dispute Resolution Chamber (DRC) of
the potential or existing contractual dispute between the player and his former club (as
well as his new club)”; and
•
on 6 September 2023, the Player was registered with Al Swehli.
In parallel, on 2 September 2023, the Club replied to the Player’s correspondence of 28
August 2023 and inter alia acknowledged that the Employment Contract had been
terminated without just cause. In particular, the Club stated the following (quoted
verbatim):
“13. Regarding the player, he have got all his salaries paid and have no overdue payments
(proved with bank cheques).
14. Player have received all his monies, and despite that the player was requesting in his
warning letters and termination letter a total of 52,500 USD beside that the player (as
known) is obligated to pay all the taxes as per the deal they have agreed on which will be
a total of 61,005 USD.
15. Also, the player should bear the fine of 10% and to be deducted from his salary as
per the consolidated list of the Arab Contractors Sporting Club (because in order to be
deducted from his 21,000 USD as per his employment contract with the club, as the club
regulations agreement list:
10% of the net contract is deducted for each player in the case of non-achievement of a
position from first to fourth position in the general ranking of the Premier League at end
of the season, deducted from percent of 25% (the participation percent) & End. / Member
of Board of Directors – the football General Supervision has the right to increase,
decrease or exempt any player from the deduction percent
16. Therefore, the player have a total negative balance (61,005 USD + 21,000 USD) =
82,005 USD.
17. By deducting the total of 82,005 USD from the overdue monies as the player
requested in his warning letters and termination letter, there will be a 29,505 USD as a
negative balance on the player towards the club which makes the termination of the
player without just cause.
pg. 7
REF. FPSD-11727
Therefore, this is an official notice that the employment contract is not terminated yet
and that [the Club] will uphold its rights about the Player”.
II. Proceedings before FIFA
19.
On 8 September 2023, the Player filed the claim at hand before FIFA. A brief summary of
the position of the parties is detailed in continuation.
a. Claim of the Player
20.
In his claim, the Player argued that the Club failed to honour its financial duties in multiple
opportunities, thus giving cause to the termination in line with art. 14bis of the FIFA
Regulations on the Status and Transfer of Players (RSTP).
21.
Consequently, he requested to be awarded the following amounts:
22.
•
USD 228,000 as outstanding remuneration “with its interest”;
•
USD 165,000 as compensation for breach of contract, corresponding to the entire
amount due for the season 2023/2024; and
•
USD 55,000 as the bonus for the participation in matches cf. par. 9 of the additional
provisions of the Employment Contract.
On 12 September 2023, the FIFA general secretariat acknowledged receipt of the claim of
the Player and requested him to provide it with inter alia “a detailed breakdown of the
amount in dispute, indicating individually: (i) each of its components, (ii) their currency, (iii)
their contractual basis and (iv) which period of time (day/month/year) they correspond to”.
23. On 13 September 2023, the Player explained that the amounts sought were the following
(quoted verbatim):
a. USD 228,000
- this amount is requested by Warning Letter sent by the Player.
- it is USD (American Dollars) as written in the employment contract.
- this amount was related to 2022-2023 football season.
b. USD 165,000
- this is the compensation requested by the Player due to the
termination made with just cause for 2023/2024 football season.
- this amount is written in the employment contract.
- it is USD (American Dollars) as written in the employment contract.
- the interest must begin from the termination date.
c. USD 55,000
- this is also compensation requested by the Player due to the
termination made with just cause for 2023-2024 football season.
pg. 8
REF. FPSD-11727
- this amount is written in the employment contract in the Sixth
Addition for 2023-202 football season.
- it is USD (American Dollars) as written in the employment contract
- the interest must begin from the termination date.
b. Reply and counterclaim of the Club
24.
On 15 October 2023, the Club filed its reply to the claim of the Player and also lodged a
counterclaim against him. The Club’s allegations can be summarized as follows.
The Player’s bad faith
25.
The Player was injured for a long time and the Club covered the costs for his entire
rehabilitation. Nevertheless, he missed trainings, requested undue amounts, and left the
country straightaway.
26.
The Player was aware that the amounts stipulated in the Employment Contract were
gross, but even so insisted in the excessive request. It must be stated that in support of
its argumentation, the Club filed extracts of WhatsApp messages however only partially
translated and without identification of the parties involved.
27.
The Club purchased flight tickets for the Player in August 2023, however he missed the
flights and triggered extra costs – all borne by the Club.
The tax liability
28.
The Employment Contract sets out that the amounts owed to the Player were gross and
should be deducted by the corresponding taxes. In particular, and as allegedly
acknowledged by the Court of Arbitration for Sport (CAS) in previous decisions, the
Egyptian national law should be applicable in order to fix the percentual of taxes as
follows:
•
Income tax: the Player’s remuneration exceeds the threshold of EGP 400,000 per
year; thus, he is liable to deduction of 25% as income tax. It follows that the Club
should withhold USD 52,500, which were “dully remitted [...] to the concerned Taxes
Authority in Egypt”. It is noteworthy that no evidence was submitted by the Club in
this respect on the following grounds (quoted verbatim):
“67. The Club would like to clarify that in accordance with the long-standing
practice of the Egyptian Tax Authority, invoices are issued upon Tax
inspections and Tax statement filed by the employer mentioning the global
number of its employees and their salaries. It is not issued individually for
each employee for a pragmatic reason as an employer may have hundreds
or thousands of employees.
pg. 9
REF. FPSD-11727
68. For avoidance of doubts, the Club submits that it sufficiently proved and
established that not only the Player accepted as per the Contract that all his
payments are subject to applicable taxes, but also the Club did remit such
taxes to the Taxes Authority.
69. Further, the Club emphasizes to the Honorable DRC that if it got ruled
that the amounts in the Contract are net (not gross), the Club would pay the
taxes amount twice (once to the Taxes Authority, which got duly done, and
once to the Player) and consequently the Club’s financial obligations will go
beyond what was agreed between the Club and the Player under the
Contract”.
•
Development tax: also according to the national law, the Club would be liable to pay
taxes ranging between 3% up to 10% on players’, coaches’ and administrative
employees’ contracts depending on their annual finances – and only to be collected
by the Club. For the Player, such tax would amount to 7.5% of his remuneration
(USD 15,750) and it should be paid in advance upon registration of his contract. In
this respect, the Club detailed the following (quoted verbatim):
“78. Regarding this amount of 15,750 USD, the Club had previously deducted
from the Player an amount of 8,068 USD. Therefore, the Club is currently
deducting the rest of the amount which is equivalent to 7,682 USD for the
purpose of payment of Development Tax.
79. However, bearing in mind that the Contract got terminated prior to the
commencement of the second contractual season, the Player’s amounts shall
be subject to the Development Tax for the first two seasons only (although
the Club paid the Player’s Development Tax for the entire Contract’s
duration).
80. Based on all the above, it becomes evident that until the date of the
Player’s termination of the Contract (8 August 2023), the Player was entitled
to the GROSS amount of USD 210,000 subject to 25% Income Tax and the rest
of 7.5% Development Tax (7,682 USD).
81. In addition, Documentation fees are to be paid to the EFA with 3% from
the Contract (the player bears 1.5% and the club bears 1.5%) in order to be
USD 3,150 on each of the parties. The Club had previously minused 2,327
USD from the player, so the rest to be paid now is 823 USD”.
29.
The Club filed copies of Egyptian national laws in support of its argumentation.
pg. 10
REF. FPSD-11727
The Club’s rank in the Egyptian Premier League
30.
According to the Club’s regulations, because of the failure of its team to achieve the first
4 positions in the Egyptian Premier League, an amount of 10% would be deducted of the
remuneration of each member of the squad, including the Player (i.e., USD 21,000).
Fulfilment of obligations
31.
The Club registered the Player and was dependant on his services for the subsequent
season. He was always welcomed to the training sessions but decided not to attend.
32.
There were no financial obligations pending towards the Player at the time of the
termination of the Employment Contract, hence it was terminated without just cause. The
Club referred to cheques issued to the Player in support of its argumentation.
33.
While considering all the appropriate deductions to be made by the Club versus the
amount claimed in the default notices, the Player would have a negative balance of USD
29,505. The deductions would amount to the following:
•
•
•
•
USD 52,500 as income tax;
USD 7,682 as development tax;
USD 823 as documentation fees;
USD 21,000 as the 10% deduction based on the Club’s rank.
Counterclaim
34.
The requirements mentioned in art. 14bis of the FIFA RSTP were not met. Thus, the Player
terminated the Employment Contract without just cause, hence should be liable to pay
USD 220,000 as the residual value for the season 2023/2024.
35.
Furthermore, the Club had received offers for the services of the Player, namely:
•
USD 2,000,000 from Ceramica Cleopatra Club; and
•
USD 1,000,000 from Al Arabi.
36.
Therefore, the Player should be liable to compensate the financial loss suffered by paying
the Club USD 2,000,000.
37.
Alternatively, in case the termination was deemed to be with just cause:
•
the Player should not receive any compensation because he concurred to the
termination of the Employment Contract;
pg. 11
REF. FPSD-11727
•
the amount of compensation should be mitigated because (i) the Player could not
find new employment; and (ii) he concurred to the breach of contract;
•
the Player should not be entitled to any additional compensation or, at least, such
amount should be limited to 3 monthly salaries; and
•
any compensation should be calculated based on the net amounts.
Requests for relief
38.
The requests for relief of the Club were as follows (quoted verbatim):
“1) To accept this Response against the Player; and
2) To fully reject the Player’s claim; and
3) To rule that the Player prematurely terminated the Contract without just cause; and
4) To rule that the club is owed an amount of USD 220,000 as the remaining of his
contract for season 2023/2024 (which is 165,000 + the participation rate USD 55,000);
and
5) A remuneration of USD 99,000 which equals 6 months from the contract; and
6) A remuneration of USD 2,000,000 for the loss for the player termination without just
cause and which equals the offers that came from another clubs for signing him.
7) Alternatively, if the Player is deemed to have terminated the Contract with just cause,
he should not be entitled to any compensation of any kind; or
8) Alternatively, should the Player be entitled to any compensation, it shall be significantly
mitigated with 75% based on all reasons explained above”.
c. Reply to the counterclaim of the Player
39.
On 13 November 2023, the Player filed his reply to the counterclaim of the Club.
40.
Firstly, the Player highlighted that the Club did not raise any of the alleged deductions
while replying to his default notices, thus acknowledged its debt.
41.
Secondly, the Player stated that it remained undisputed that he participated in 34
matches during the season 2022/2023, triggering the bonus clause and making it “not
credible” that he would still have a debt of USD 29,505 towards the Club.
pg. 12
REF. FPSD-11727
42.
Thirdly, the Player challenged the Club’s request for compensation for financial loss and
argued that it was based on untrue offers.
43.
Fourthly, and as to the tax liabilities, the Player underlined that the Club “has never
submitted any tax paid by the [Club], any evidence showing how much they paid in this regard.
The parties mentioned [in the] employment contract agreed on net amounts”. In support, the
Player argued that:
•
the sign-on fee of USD 100,000 due by the Club was paid net, entailing that the
Club’s argumentation regarding the deductions was only raised at FIFA;
•
for the seasons 2021/2022 and 2022/2023, the Club paid all the amounts
mentioned in the Employment Contract without deductions and has never
mentioned the issue of taxes;
•
As such, in the Player’s words (quoted verbatim):
“Firstly, the [Club] never wrote and sent any evidence showing how much they
paid to the tax offices on behalf of the [Player]. Mainly, the [Player] hereby
submits a payment document taken from the bank made by the [Club]. It is
seen from the payments that the [Club] has never deducted any amount for
the payment of taxes”.
44.
Lastly, the Player argued that by arguing that the compensation should be reduced, the
Club acknowledged that it failed to honour its financial duties.
d. Final comments of the Respondent
45.
On 20 November 2023, the Club filed its final comments on this matter and reiterated its
previous position.
46.
In addition, the Club argued that the Player could not properly breakdown the amount
claimed, as well as confirmed being aware that the Employment Contract provided for his
remuneration gross.
47.
In particular, regarding the taxes, the Club alleged that the Player’s ignorance of the
Egyptian Tax Law does not prevent its applicability. Likewise, it insisted on the applicable
deductions to be made over his entitlements, as well as in the veracity of the offers
received from other clubs – which, therefore, support its position concerning the financial
loss with the premature termination of the Employment Contract.
48.
Finally, the Club reiterated its requests for relief.
pg. 13
REF. FPSD-11727
e. Position of the Intervening Party
49.
In light of the possible consequences arising from the termination of the Employment
Contract in line with art. 17, par. 2 of the FIFA RSTP, Al Swehli was called as a party to these
proceedings and invited to file its position on the case file, which it did on 16 December
2023.
50.
Accordingly, Al Swehli firstly stressed that the Employment Contract was terminated with
just cause by the Player based on art. 14bis of the FIFA RSTP. In this respect, Al Swehli
argued that the Club could not prove having paid the full salaries of the Player, as well as
did not demonstrate that it ever paid any amount to the tax authorities.
51.
Furthermore, Al Swehli underlined that it only signed the Player after the Employment
Contract was already terminated. It filed WhatsApp conversations in this regard and
stated that there was no inducement, hence no joint liability nor sporting sanctions should
be considered (cf. art. 17, par. 4 of the FIFA RSTP).
52.
Al Swehli requested that the counterclaim of the Club be rejected or, in the alternative,
that the presumption of joint liability is refuted for that the Player shall be the sole
responsible for any consequence.
III. Considerations of the Dispute Resolution Chamber
a. Competence and applicable legal framework
53.
First of all, the Dispute Resolution Chamber (hereinafter: 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 8 September 2023 and submitted for
decision on 8 February 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.
54.
Furthermore, 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 FIFA
RSTP (May 2023 edition), the Dispute Resolution Chamber is competent to deal with the
matter at stake, which concerns an employment-related dispute with an international
dimension between a Nigerian player and an Egyptian club, with the intervention of a
Libyan club.
55.
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 FIFA RSTP (May 2023 edition) and considering that the present claim was
pg. 14
REF. FPSD-11727
lodged on 8 September 2023, 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
56.
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 TMS.
c. Merits of the dispute
57.
The 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
58.
The foregoing having been established, the Chamber moved to the substance of the
matter, and took note of the fact that it pertains to a claim for breach of contract.
59.
In particular, the Chamber noted that the Player terminated the Employment Contract on
8 August 2023 due to overdue payables. Nevertheless, the parties dispute whether such
termination took place with just cause and the consequences that follow, both of which
shall be assessed by the DRC.
60.
Against this background, the Chamber initially recalled the contents of art. 14bis, par. 1 of
the Regulations, which reads as follows:
“In the case of a club unlawfully failing to pay a player at least two monthly salaries
on their due dates, the player will be deemed to have a just cause to terminate his
contract, provided that he has put the debtor club in default in writing and has
granted a deadline of at least 15 days for the debtor club to fully comply with its
financial obligation(s). Alternative provisions in contracts existing at the time of this
provision coming into force may be considered.” (emphasis added by the Chamber).
61.
It follows from the above that two requirements must be met so that art. 14bis of the
Regulations is successfully triggered: (1) at least two salaries must be outstanding; and (2)
pg. 15
REF. FPSD-11727
the debtor must have been put in default and failed to fully remedy the breach within 15
days.
62.
On this note, the Chamber turned its attention to the case file and found it essential that
the Player put the Club in default on 18 July 2023 for an amount of USD 128,250 and
expressly granted 15 days for it to pay its dues. As such, the DRC acknowledged that its
task was to establish whether such amount was effectively due and, if so, whether the
breach was fully cured by the Club within the deadline given by the Player.
63.
As a departure point, the DRC observed that the Player broke down the amount claimed
in the abovementioned notice as follows:
•
•
•
USD 12,750 as the balance for the season 2021/2022;
USD 63,000 as salary; and
USD 52,500 as participation fee.
64.
On the other hand, the Chamber was also observant that the Club alleged that (i) it paid
the full remuneration of the Player for the season 2021/2022; (ii) the amounts payable to
the Player were subject to deductions; and (iii) the Player was the one in debt with the
Club, for a total amount of USD 29,505.
65.
In addition, the Chamber took note that the calculations provided by both the Player and
the Club were unclear and inconsistent. In fact, the DRC considered that its only
alternative was to contrast the amounts the Player was contractually entitled to receive
with the ones that the Club could corroborate having paid. The Chamber remarked in this
respect that, in line with art. 13, par. 5 of the Procedural Rules, the Club bore the burden
of proof to demonstrate that it complied with its financial obligations and/or that it was
legally entitled not to do so.
66.
The Chamber’s findings to this extent were the following.
67.
Firstly, the DRC observed that, by the time the default notice was sent by the Player, he
should already have received the following amounts:
•
Season 2021/2022: USD 150,000 gross as advanced payment and salaries, plus
USD 50,000 as participation fee – therefore, totalling USD 200,000.
•
Season 2022/2023: USD 157,500 as salaries.
•
It remained undisputed that the Player achieved the attendance goal for the
season 2022/2023, however, per the information available in TMS, the official end
of that season in Egypt was only on 25 July 2023, entailing that the USD 52,500 as
participation fee was not yet due.
pg. 16
REF. FPSD-11727
68.
In contrast, the proofs of payment filed by the Club corroborate that it made the following
payments to the Player:
Date of Payment
27/10/2022
29/11/2022
21/12/2022
23/01/2023
Amount (EGP)
105,362
263,511
46,588
352,657
401,072
27/03/2023
13/04/2023
29/05/2023
17/07/2023
17/07/2023
-
27/07/2023
27/07/2023
-
-
08/08/2023
TOTAL
69.
70.
Amount (USD)
6,692.76
13,350.40
1,892.040
14,250.20
13,428.70
Reference
Participation rate season 2021/2022
Salary of October 2022
Instalment 11-2022
Third instalment of season 20222023
14,909
Salary of January 2023
14,587
Salary of February 2023
14,926
Salary of March 2023
14,927
Salary of April 2023
14,927
Salary of May 2023
18 July 2023 – Default notice
14,927
Salary of June 2023
12,802
Outstanding amount for the Player
John Okly
Termination by the Player
14,927
Salary of July 2023
166,546.10
The Chamber also wished to clarify the following concerning the figures above:
•
for payments made in local currency, the DRC took into consideration the exchange
rate of the date of payment. Where the date of payment was not specified, the
conversion rate used was the one of the date of signature of the Employment
Contract; and
•
the payments of housing allowance and other match bonuses were disregarded
insofar as they are not claimed or challenged by the Player in the dispute at hand.
By assessing the evidence, the Chamber determined that:
(i) Season 2021/2022
71.
Despite alleging that all the amounts due for the previous season were already
successfully paid, the Club did only file one proof of payment amounting to approx. USD
6,692.76 (EGP 105,362) and with reference to the participation fee of USD 50,000.
72.
As such and due to the lack of evidence on file, the Club could not demonstrate that it
indeed fulfilled its financial obligations until September 2022, hence that the balance of
USD 12,750 claimed by the Player in his default notice had already been complied with.
pg. 17
REF. FPSD-11727
73.
While it appeared reasonable to the Chamber that such difference could be linked to the
tax deductions, it was for the Club to corroborate that it effectively paid such amounts to
the relevant tax authorities. The DRC remarked in this respect:
•
the mere references of the Club to the national law and the tax applications
concerning other Egyptian clubs are not sufficient to demonstrate that the same tax
liability was applicable to the Player.
•
the Club alleged that it could not file the tax certificates as they were issued per
group of employees, hence could not be individualized. Nevertheless, by failing to
provide any type of evidence in support of its argumentation (even if the proof of
payment of the taxes per group of players and/or of the payments made to the
federation), the Club could not corroborate that it indeed complied with its
obligation.
•
the Club also failed to advance any financial documentation proving that the Player
was made aware of the corresponding deductions (e.g., payslips or financial
statements). To the contrary, the proof of payment filed by the Club suggest that
each month the Player was credited a slightly different amount, without any
identification and/or breakdown.
74.
Given the above, the Chamber decided that the Club could not discharge its burden of
proof. It followed, in its view, that the balance of USD 12,750 were indeed payable to the
Player at the time of the default notice, hence should be considered for the sake of
calculation.
75.
For completeness, the Chamber found it noteworthy that in a previous case before the
Football Tribunal (case ref. FPSD-9137), the DRC had accepted the position of an Egyptian
club concerning tax deductions – which was construed in a similar manner as in the case
at hand. Nevertheless, in said case, the club concerned submitted further documentation
(even if collective) corroborating the payments made to the tax authorities, which were
also not disputed by the counterparty in those proceedings. The Chamber however found
that the situation was not the same in the case at hand in that the only evidence advanced
by the Club was a copy of the national tax law and letters addressed to third parties. In
the absence of any documentary evidence corroborating in concrete the Player’s tax
regime and the Club’s compliance with the payment to the tax authorities, the Chamber
confirmed that the position of the latter should not succeed.
(ii) Season 2022/2023
76.
By offsetting the salaries owed to the Player in the season 2022/2023 to the amounts
effectively paid by the Club until the date the default notice was sent, the Chamber
observed the following:
pg. 18
REF. FPSD-11727
Reference
October 2022
November 2022
December 2022
January 2023
February 2023
March 2023
April 2023
May 2023
June 2023
July 2023
Amount due
(USD)
15,750
15,750
15,750
15,750
15,750
15,750
15,750
15,750
15,750
15,750
Amount paid
Date of payment
(USD)
13,350.40
27/10/2022
14,250.20
21/12/2022
13,428.70
23/01/2023
14,909
27/03/2023
14,587
13/04/2023
14,926
29/05/2023
14,927
17/07/2023
14,927
17/07/2023
In default at the time of the notice of
18 July 2023
Balance
(USD)
2,399.60
3,899.40
6,220.70
7,061.70
8,224.70
9.048,70
9,871.70
10,694.70
26,444.70
42,194.70
77.
Once again, the Chamber remarked that the amounts considered were the ones properly
specified and supported by documentary evidence by the Club.
78.
With the above in mind, the DRC acknowledged that at the time the default notice was
sent, the Club owed the Player a total of USD 42,194.70 for the season 2022/2023 plus the
already mentioned USD 12,750 for the season 2021/2022, which should have been fully
remedied within the following 15 days (i.e., by 2 August 2023).
79.
In parallel, the DRC noted that the Club paid the following sums as from 18 July 2023:
Reference
June 2023
Overdue payables
July 2023
Amount paid (USD)
14,927
12,802
14,927
Date of payment Balance (USD)
27/07/2023
27,267.70
27/07/2023
14,465.70
08/08/2023
+ 461.30
80.
Alike for the previous season, the Chamber highlighted that no further documentation
was produced by the Club concerning the taxes payable by the Player in the season
2022/2023, therefore it applied the same rationale.
81.
Likewise, the DRC dismissed the Club’s argumentation concerning both the
documentation fees and the 10% deduction linked to the ranking of its team in the
Egyptian Premier League. The reasoning of the Chamber was the following:
•
Documentation fees: the Club failed to advance any evidence concerning the
payment of those fees or the proper communication of this liability to the Player.
•
10% deduction linked to the ranking: the Club expressly acknowledged in its
correspondence of 1 August 2023 that it had waived such deduction. As such and
without even needing to discuss the proportionality of such deduction, the Chamber
stated that the Club could not change its course of action and allege a posteriori that
the deduction should have been applied (venire contra factum proprium).
pg. 19
REF. FPSD-11727
(iii) Interim Conclusion
82.
In view of all the above, the Chamber came to the conclusion that the requirements of art.
14bis of the Regulations are met in the case at hand.
83.
In particular, the DRC acknowledged that at the time the default notice was sent (i.e., 18
July 2023), the Club owed the Player approx. USD 54,944.7 (i.e., USD 12,750 for the season
2021/2022 plus USD 42,194.70 for the season 2022/2023), hence more than 2 monthly
salaries. Furthermore, when the 15 days elapsed (i.e., 2 August 2023), such debit had not
been fully paid.
84.
The Chamber observed that the Club had apparently cured its breach for the 2022/2023
season on the same date that the Player notified the termination of the Employment
Contract. Nevertheless, the DRC found it essential that: (i) there is no evidence on file
demonstrating whether the amount was credited before or after the receipt of the
termination notice; (ii) such payment was made after the 15 days’ deadline had already
expired, therefore corroborating that the Club was indeed aware of its breach of default;
and, in any event, (ii) the Player was still entitled to a balance for the season 2021/2022,
which was never cured.
85.
In parallel, the Chamber also wished to highlight that in between the exchanges between
the parties and the termination of the Employment Contract (i.e., 26 July 2023), the Player’s
participation fee for the season 2022/2023 has also fallen due and was not paid by the
Club. In this connection, the DRC noted that the only requirement mentioned in the
Employment Contract for such concept to be due was the Player “actively participating in
matches”, which was never challenged by the Club. Indeed, in the exchanges between the
parties, the Club only argued that the Player’s request was premature, but not that it was
not owed. Nevertheless, it also failed to justify the default.
86.
The Chamber was of the opinion that, even if the participation fee was formally not
considered for the purposes of the calculation of overdue payables per art. 14bis of the
Regulations, such debt added up to its understanding that the Club was persistently in
default of its financial obligations towards the Player.
87.
Therefore, based on all the abovementioned considerations, the DRC decided that the
Player terminated the Employment Contract with just cause.
ii. Consequences
88.
Having stated the above, the Chamber turned to the question of the consequences of
such unjustified breach of contract committed by the Club.
pg. 20
REF. FPSD-11727
89.
In doing so, the Chamber initially underscored that, in accordance with the general legal
principle of pacta sunt servanda, the Player should be entitled to his outstanding
remuneration at the time of the termination, as follows:
•
USD 12,288.70 as the outstanding remuneration for the season 2021/2022 (i.e., USD
12,750) minus the amount that was overpaid by the Club in the season 2022/2023
so that there is no unjust enrichment by the Player; and
•
USD 52,500 as the participation fee owed to the Player for the season 2022/2023.
90.
In addition, taking into consideration the Player’s request, the principle of ne ultra petita,
and the constant practice of the Chamber in this regard, the latter decided to award the
Player interest at the rate of 5% p.a. on the outstanding amounts as from the date of
termination of the Employment Contract (i.e., 8 August 2023) until the date of effective
payment.
91.
Having stated the above, the Chamber turned to the calculation of the amount of
compensation payable to the Player by the Club in the case at stake. In doing so, the
Chamber firstly recapitulated that, in accordance with art. 17 par. 1 of the Regulations,
the amount of compensation shall be calculated, in particular and unless otherwise
provided for in the contract at the basis of the dispute, with due consideration for the law
of the country concerned, the specificity of sport and further objective criteria, including
in particular, the remuneration and other benefits due to the Player under the existing
contract and/or the new contract, the time remaining on the existing contract up to a
maximum of five years, and depending on whether the contractual breach falls within the
protected period.
92.
In application of the relevant provision, the Chamber held that it first of all had to clarify
as to whether the pertinent employment contract contained a provision by means of
which the parties had beforehand agreed upon an amount of compensation payable by
the contractual parties in the event of breach of contract. In this regard, the Chamber
established that no such compensation clause was included in the employment contract
at the basis of the matter at stake.
93.
As a consequence, the members of the Chamber determined that the amount of
compensation payable by the Club to the Player had to be assessed in application of the
other parameters set out in art. 17 par. 1 of the Regulations. The Chamber recalled that
said provision provides for a non-exhaustive enumeration of criteria to be taken into
consideration when calculating the amount of compensation payable.
94.
Bearing in mind the foregoing as well as the claim of the Player, the Chamber proceeded
with the calculation of the monies payable to the Player under the terms of the contract
from the date of its unilateral termination until its end date. Consequently, the Chamber
concluded that the amount of USD 165,000 (i.e., the entire remuneration for the season
pg. 21
REF. FPSD-11727
2023/2024) serves as the basis for the determination of the amount of compensation for
breach of contract. For completeness, the Chamber clarified that as the participation fee
was linked to the Player being fielded, his entitlement to such amount would be
speculative, hence it should not be taken into account.
95.
In continuation, the Chamber verified as to whether the Player had signed an employment
contract with another Club during the relevant period of time, by means of which he
would have been enabled to reduce his loss of income. According to the constant practice
of the DRC as well as art. 17 par. 1 lit. ii) of the Regulations, such remuneration under a
new employment contract shall be taken into account in the calculation of the amount of
compensation for breach of contract in connection with the player’s general obligation to
mitigate his damages.
96.
At this point, the DRC observed that the Player found employment with Al Swehli and his
remuneration under the pertinent contract for the season 2023/2024 alone already
exceeds the residual value of the Employment Contract, without even having added up
the pro rata signing fee. Consequently, the Chamber determined that the Player fully
mitigated his damages.
97.
Subsequently, the Chamber referred to art. 17 par. 1 lit. ii) of the Regulations, according
to which a player is entitled to an amount corresponding to three monthly salaries as
additional compensation should the termination of the employment contract at stake be
due to overdue payables. In the case at hand, the Chamber confirmed that the
termination of the Employment Contract took place due to said reason i.e., overdue
payables by the Club, and therefore decided that the Player shall receive additional
compensation.
98.
On this note, the DRC decided that the Player should be entitled to three times his monthly
remuneration of the Player at the time of the termination of the Employment Contract.
Nevertheless, when fixing the quantum concerned, the Chamber noted that in August
2023, the Player was in-between seasons. Consequently, the Chamber found it the most
reasonable to calculate the additional compensation owed to the Player based on the
average of his salaries for the previous season 2022/2023 (USD 15,750) and the
subsequent 2023/2024 (USD 16,500), arriving at USD 16,125.
99.
Consequently, on account of all of the above-mentioned considerations and the
specificities of the case at hand, the Chamber decided that the Club must pay the amount
of USD 48,375 to the Player (i.e., USD 16,125 times 3), which was to be considered a
reasonable and justified amount of compensation for breach of contract in the present
matter. For completeness, the Chamber also expressly rejected the alternative request of
the Club to further mitigate the compensation due to the Player’s behaviour.
pg. 22
REF. FPSD-11727
100. Lastly, taking into consideration the Player’s request as well as the constant practice of
the Chamber in this regard, the latter decided to award him interest on said compensation
at the rate of 5% p.a. as of 8 August 2023 until the date of effective payment.
iii. Compliance with monetary decisions
101. 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.
102. 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
maximum duration of the registration ban shall be of up to three entire and consecutive
registration periods.
103. Therefore, bearing in mind the above, the DRC decided that the Club must pay the full
amount due (including all applicable interest) to the Player within 45 days of notification
of the decision, failing which, at the request of the Player, 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 Club in
accordance with art. 24 par. 2, 4, and 7 of the Regulations.
104. The Club shall make full payment (including all applicable interest) to the bank account
provided by the Player in the Bank Account Registration Form, which is attached to the
present decision.
105. 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
106. 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.
107. 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.
pg. 23
REF. FPSD-11727
108. Lastly, the DRC concluded its deliberations by rejecting any other requests for relief made
by any of the parties.
pg. 24
REF. FPSD-11727
IV. Decision of the Dispute Resolution Chamber
1.
The claim of the Claimant / Counter-Respondent, John Okoli, is partially accepted.
2.
The Respondent / Counterclaimant, Arab Contractors, must pay to the Claimant / CounterRespondent the following amount(s):
- USD 64,788.70 as outstanding remuneration plus 5% interest p.a. as from 8 August 2023
until the date of effective payment; and
- USD 48,375 as compensation for breach of contract without just cause plus 5%
interest p.a. as from 8 August 2023 until the date of effective payment.
3.
Any further claims of the Claimant / Counter-Respondent are rejected.
4.
The counterclaim of the Respondent / Counterclaimant is 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 / Counterclaimant 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.
pg. 25
REF. FPSD-11727
7.
The consequences shall only be enforced at the request of the Claimant / CounterRespondent 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. 26
REF. FPSD-11727
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. 27