Labour Disputes
Texto da decisão
REF FPSD-6192
Decision of the
Dispute Resolution Chamber
passed on 24 November 2022
regarding an employment-related dispute concerning the player CRISTIAN
PORTILLA RODRIGUEZ
COMPOSITION:
Frans de Weger (the Netherlands), Chairperson
Peter Lukasek (Slovakia), member
Jerome Perlemuter (France), member
CLAIMANT:
Cristian Portilla Rodríguez, Spain
Represented by Ms Teodora Latchezar Taneva and
Mr Oriol Castañer Folch
RESPONDENT:
Aris FC, Greece
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I. Facts of the case
1.
On 23 January 2013, the Dispute Resolution Chamber (DRC) passed a decision (hereinafter:
the previous decision) condemning Aris FC (hereinafter: the 1st Aris FC) to pay to the player,
Mr Cristian Portilla Rodríguez (hereinafter: the player or the Claimant) the amount of EUR
369,500, which was never paid by the 1st Aris FC.
2.
On 26 July 2020, the player and the Greek club, Aris FC (hereinafter: the club or the
Respondent), considered the sporting successor of the 1st Aris FC, concluded a settlement
agreement (hereinafter: the settlement agreement).
3.
According to clause 3 of the settlement agreement, the club undertook to pay to the player
the final settlement amount of EUR 350,000 net, as follows:
-
EUR 300,000 net “within 72 hours after signature of this agreement”, i.e. by 29 July 2020;
EUR 25,000 net by 30 October 2020;
EUR 25,000 net by 30 November 2020.
4.
Clause 2 of the settlement agreement states, inter alia, the following: “[…] All payments
indicated in this contract are to be considered as “net” of taxes. […] Consequently, the Club
would have to make the corresponding gross up to pay to the Player the net amount agreed
in this contract. This clause is essential for the player to grant his consent to the present
contract and its supplementary agreements. For that reason should the tax authorities in
Greece or Spain request from the Player any amount as tax, withholding, surcharge,
sanction, interest or any other tax liability, as a result of the payment under this contract,
then the player shall be entitled to claim this amount to the club. For the avoidance of
doubt should the Club fail to pay the indicated amounts to the Player, then the Player shall
have the right to claim such amount against the club and if necessary to initiate legal
actions against the Club. In the event that the Club has to pay any amount to the Player as
a compensation for the liabilities paid by the Player, the Club will proceed to make the
corresponding gross-up in order to avoid any tax liability for the Player in such payments
[…]”.
5.
Under clause 11 of the settlement agreement, the parties granted jurisdiction to FIFA and
to the CAS to hear any dispute eventually arising from the contract.
6.
During the year 2020, the player was a tax resident in Spain.
7.
Upon presentation of his Personal Income Tax Declaration (hereinafter: PITD) before the
Spanish Tax Authorities on 25 June 2021, concerning the player’s personal income
perceived during the fiscal year 2021, the player paid the amount of EUR 99,995 to the said
tax authorities in connection with the payment received from the club as per the settlement
agreement.
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8.
On 13 December 2021, the parties exchanged correspondence concerning the payment of
the amount of EUR 99,995 to the Claimant.
9.
On 27 April 2022, the player put the club in default of payment in the amount of EUR 99,995,
thereby granting the club a deadline of 10 days to proceed with the payment of the
aforementioned amount; however, to no avail.
II. Proceedings before FIFA
a. Position of the Claimant
10. On 28 May 2022, the player lodged a claim against the club before FIFA, requesting to be
reimbursed in the amount of EUR 99,995, plus 5% interest p.a. as from 13 December 2021
until the date of effective payment.
11. In his claim, the player refers to clause 2 of the settlement agreement and argues that,
thereunder, the club undertook to pay any taxes eventually payable in either Greece or
Spain in connection with the payment of the settlement amount, i.e. EUR 350,000.
12. In this context, the player explained that, upon presentation of his PITD concerning the
income he received during the fiscal year 2020, he paid the amount of EUR 99,995 to the
Spanish Tax Authorities and that, according to clause 2 of the settlement agreement, the
player is entitled to be reimbursed the said amount from the Respondent.
b. Position of the Respondent
13. In its reply as to the competence of the Football Tribunal, the club challenged the
jurisdiction of FIFA to hear the present dispute, insofar as such a complex dispute
concerning taxes related to the income received by the player from the club is “extremely
difficult, if not impossible for FIFA” to decide.
14. As to the substance, the club argued that the player “erred in declaring in Spain the
amounts he received, as income taxable in Spain and also erred in determining the nature
of the said payments, which led to him being requested by the Spanish tax authorities to
pay the total amount of 99,994 euros, when no such tax should have been payable if the
Claimant had declared correctly the received amounts before the Greek tax authorities as
far as the outstanding salaries are concerned and as far as the compensation is concerned,
before the Greek tax authorities or the Spanish tax authorities as an amount from an
agreed penal clause”.
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15. In this respect, the club explained that the amount paid by the club, i.e. EUR 350,000,
“corresponds to 69,500 euros of outstanding remuneration from the employment contract
of the Claimant signed in 2011 with the old club Aris Thessaloniki FC and to 280,500 euros
of penalty/compensation for the breach of the contract by the old club”, which was paid by
the Respondent insofar as it was considered the sporting successor of the previous Aris FC.
16. As for the consideration of the amount paid as per the settlement agreement, the club held
that “any tax imposed by the Spanish authorities on the Claimant on the basis of the
amount of 280,500 euros of the agreed penal clause that was paid to the Claimant by Aris
FC, is due to the wrong declaration of the Claimant and thus, it cannot be accepted that
our club shall be obliged to pay such amount to the player, since the said amount is only
payable and is requested by the Spanish tax authorities due to the Claimant’s mistake and
the wrongful declaration of the said non-taxable amount”.
17. In this regard, the club stressed that the correct consideration of the amounts paid to the
Claimant are:
-
“i) outstanding salaries since 2011 from his employment contract with Aris Thessaloniki
FC, as far as the 69,500 euros are concerned (the fact that the said amount corresponds
to unpaid and outstanding remuneration from the employment contract of 2011 is also
confirmed by the FIFA decisions)” and that, thus, “the amount of 69,500 euros refers to
unpaid outstanding salaries of 2011, the said amount should only be declared in Greece
for the year 2011 to which it refers” and;
-
“ii) agreed penal clause paid as far as the 280,500 euros are concerned (the FIFA
decisions also confirm that the said amount was paid as penalty compensation agreed
between the parties for the case of violation of the contract)” and that “the remaining
amount of 280,500 euros corresponds to an agreed penal clause that was paid to the
Claimant, the said remaining amount is not considered an income and thus, it was not
taxable”.
18. In addition, the club argued that it concluded the settlement agreement “under duress,
since it needed to have [a registration] ban lifted since it had remained with only 11 players
and thus, accepted the irrational and abusive terms requested by the Claimant”. What is
more, the club held that the terms of the settlement agreement are abusive.
19. In its request for relief, the club requested the claim of the Claimant be considered
inadmissible and, subsidiary, “to rule that the Claimant’s tax return filed before the Spanish
tax authorities was wrongly filed and that the determination of the nature of the received
amounts was wrong and that the imposed taxes are due to the mistakes of the Claimant
and cannot be considered as creating an obligation of Aris FC to pay the amount of the said
imposed taxes to the Claimant based on clause 2 of the Settlement Agreement of 26 July
2020”.
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20. Even subsidiary to the above, the club requested the claim of the player be rejected as
considered abusive.
III. Considerations of the Dispute Resolution Chamber
a. Competence and applicable legal framework
21. First of all, the Dispute Resolution Chamber (hereinafter also referred to as “the DRC” or
“the 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 27 May 2022 and
submitted for decision on 24 November 2022. Taking into account the wording of art. 34
of the October 2022 edition of the Procedural Rules Governing the Football Tribunal
(hereinafter: the Procedural Rules), the aforementioned edition of the Procedural Rules is
applicable to the matter at hand.
22. Subsequently, the Chamber referred to art. 2 par. 1 and art. 24 par. 1 lit. a) 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 (October 2022), it is, in
principle, competent to deal with the matter at stake, which concerns an employmentrelated dispute with an international dimension between a Spanish player and a Greek
club.
23. However, the DRC noted that the club challenged the competence of FIFA to decide upon
the present dispute on the grounds that such a complex dispute concerning the payment
of taxes in connection with the income received by the player from the club is “extremely
difficult, if not impossible for FIFA” to decide.
24. In this respect, the Chamber wished to refer to clause 11 of the settlement agreement,
which explicitly foresees the competence of FIFA to hear the present dispute. In addition and in order to analyse whether the DRC is competent to hear the present dispute-, an
analysis of the pre-requisites set by art. 22 para 1 lit. b) of the Regulations on the Status
and Transfer of Players (hereinafter: the Regulations or the RSTP) needs to be undertaken:
-
Considering that the present dispute is based on a settlement agreement and not an
employment contract, the Chamber highlighted that it may be useful to refer to the
Commentary on the RSTP (edition 2021; page 363), which points out the following:
“disputes between a player and a club arising from an agreement on monies owed and
remuneration from a previous employment relationship, should qualify as
“employment-related” [which] is also confirmed by the consistent jurisprudence of the
DRC. It is widely accepted that if such disputes have an international dimension (as this
one did), they can be heard by the DRC”;
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-
That it arises between a player and a club of international dimension - which is not
disputed, as noted by the DRC.
25. In connection with the allegation that FIFA is not competent to deal with disputes in
connection with taxes, the said argument needs to be rejected, underscored the Chamber,
insofar as the DRC has de facto passed several decisions in connection with the entitlement
of the creditor to be awarded taxes from the debtor, FIFA being competent to do so when
the requisites of art. 22 of the Regulations are met, as in casu.
26. What is more -and as a marginal note, pointed out the Chamber-, FIFA is often in a better
and more suitable position than the national courts to adjudicate on this sort of matters
insofar as it counts with more effective means of execution taking into account that the
parties to this kind of disputes often have their domiciles in different countries.
27. Thus, the Chamber determined that the necessary prerequisites for the Football Tribunal
in general and for the DRC in particular to hear the present dispute are met and the
Chamber has jurisdiction to hear the present matter.
28. 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 (October 2022 edition) and
considering that the present claim was lodged on 27 May 2022, the March 2022 edition of
said regulations (hereinafter: the Regulations) is applicable to the matter at hand as to the
substance.
b. Burden of proof
29. 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
30. 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
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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
31. The foregoing having been established, the Chamber moved to the substance of the matter
and wished to recall that the Claimant is requesting the reimbursement of the amount of
EUR 99,995, plus 5% interest p.a. as from 13 December 2021 until the date of effective
payment corresponding to the amount paid by the Claimant before the Spanish Tax
Authorities on 25 June 2021.
32. In his claim, continued the Chamber, the Claimant explains that, due to the payment of
EUR 350,000 made by the club to the player in the year 2020 as per the settlement
agreement, the Claimant duly declared and paid the said amount in Spain, where he
resided during the year 2020.
33. In this context, the Claimant referred to clause 2 of the settlement agreement and argues
that the club undertook to pay any amount claimed by any tax authority in either Spain or
Greece in connection with the payment of EUR 350,000.
34. On its part, the club raised different arguments. The main arguments wielded by the club
are displayed here below:
-
That the settlement agreement was concluded under “duress”, considering that a
registration ban had been imposed on the club due to the non-compliance with the
previous decision and the club needed the ban to be lifted;
-
That the amount paid to the player was wrongly declared by the latter as income of
the fiscal year 2020, since it pertained to outstanding salaries that were payable in
2011 that were subject to taxation in Greece and not in Spain; and insofar as the
consideration of a substantial part thereof (EUR 280,500) was a penalty, which is not
taxable;
-
That the claim of the Claimant is abusive.
35. The above having been recalled, the DRC stressed that, whereas it is true that the amount
payable as per the settlement agreement (EUR 350,000) corresponds to amounts due to
the player as per the previous DRC decision, it is also true that the settlement agreement
novated the debt of the club towards the player, foreseeing the payment of the said
amount in the year 2020.
36. In this context, continued the Chamber, the allegations of the club concerning the nature
of the amount paid to the player need to be addressed. In doing so, the Chamber observed
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that the club argues 1.) that the amount pertaining to overdue salaries was taxable in
Greece and 2.) that the penalty is not taxable. In this respect, it needs to be noted that,
regardless of the original nature of the amounts paid in 2020, i.e. a debt concerning salaries
originally payable in 2011 and a penalty, the whole amount (EUR 350,000) was paid to the
player in 2020. Considering that the player is a natural person and that the nature of the
said remuneration integrates the category of employment income (it derives from the
employment relationship that bound the player and the club), the player had the legal
obligation to declare them as part of his Personal Income Tax Declaration (cf. art. 96 para.
2 lit. a) of the Law 35/2006, of 28 November – Spanish Personal Income Tax Law).
37. The above being said, considering that the player was a tax resident in Spain during the
year 2020, any income received by the Claimant during the said fiscal year had to be
declared in front of the Spanish Tax Authorities by 30 June 2021 (art. 8 of Order
HAC/248/2021, of 16 March.
38. Therefore, the Chamber determined that the player correctly declared the said amount
before the Spanish Tax Authorities.
39. As to the argument of the club that the settlement agreement was signed under duress
and in an abusive way, such an argument cannot be upheld, insofar as the Respondent
failed to provide any evidence of such alleged duress and, in connection with the alleged
abusive terms of the settlement agreement, the Chamber underscored that the only abuse
has been perpetrated by the Respondent, insofar as amounts that were due as per the
previous DRC decision (rendered back in 2013) were only paid in 2020.
40. Thus, considering that clause 2 of the settlement agreement is clear when it establishes
that the Respondent has the obligation to pay any taxes (either in Spain or in Greece) in
connection with the amounts thereunder payable, the Chamber determined that the
Claimant is entitled to receive the amount paid by the latter in front of the Spanish Tax
Authorities in relation to the amounts that it received from the club in 2020 (EUR 350,000).
ii. Consequences
41. Having stated the above, the members of the Chamber turned their attention to the
question of the consequences of such unjustified breach of contract committed by the
Respondent and decided that, in accordance with the legal principle pacta sunt servanda,
the Claimant is entitled to receive outstanding remuneration from the Respondent in the
amount of EUR 99,995.
42. In addition, in view of the request of the Claimant and in accordance with the constant
jurisprudence of the DRC, the Chamber decided to award the Claimant a default interest
of 5% interest p.a. on the amount of EUR 99,995, as from 13 December 2021 until the date
of effective payment.
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43. In this respect, the Chamber clarified that the Claimant could have requested the default
interest to run as from 26 June 2021, since the player provided evidence of having paid the
said amount to the Spanish Tax Authorities on 25 June 2021. However, considering that the
player is only requesting the interest to run as from 13 December 2021 (date on which the
parties exchanged correspondence related to the payment of the taxes paid by the player),
the Chamber decided that the request of the Claimant is to be accepted (ne ultra petita).
iii. Compliance with monetary decisions
44. 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.
45. In this regard, the Chamber 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.
46. Therefore, bearing in mind the above, the Chamber 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 creditor, 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.
47. 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.
48. The Chamber 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
49. 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,
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or match agent”. Accordingly, the Chamber decided that no procedural costs were to be
imposed on the parties.
50. Furthermore, 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.
51. Lastly, the Chamber concluded its deliberations by rejecting any other requests for relief
made by any of the parties.
IV. Decision of the Dispute Resolution Chamber
1.
The Football Tribunal has jurisdiction to hear the claim of the Claimant, Cristian Portilla
Rodríguez.
2.
The claim of the Claimant is accepted.
3.
The Respondent, Aris FC, has to pay to the Claimant the following amount:
- EUR 99,995 as outstanding remuneration plus 5% interest p.a. as from 13 December
2021 until the date of effective payment.
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.
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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
NOTE RELATED TO THE APPEAL PROCEDURE:
According to article 57 par. 1 of the FIFA Statutes, this decision may be appealed against
before the Court of Arbitration for Sport (CAS) within 21 days of receipt of the notification
of this decision.
NOTE RELATED TO THE PUBLICATION:
FIFA may publish this decision. For reasons of confidentiality, FIFA may decide, at the
request of a party within five days of the notification of the motivated decision, to publish
an anonymised or a redacted version (cf. article 17 of the Procedural Rules).
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