DRC Overdue Payables
Texto da decisão
REF FPSD-6053
Decision of the
Dispute Resolution Chamber
passed on 4 August 2022
regarding an employment-related dispute concerning the player Xandro
Dylan Schenk
COMPOSITION:
ONGARO, Omar (Italy), Deputy Chairperson
TIMERA, Khadija (Senegal), Member
VAURASI, Laurel (Fiji), Member
CLAIMANT:
Xandro Dylan Schenk, the Netherlands
Represented by Ruiz-Huerta & Crespo
RESPONDENT:
Al Batin FC, Saudi Arabia
Represented by Sport Makers
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I. Facts of the case
1.
On 28 June 2021, the Dutch player, Mr Xandro Dylan Schenk (hereinafter: the player or the
Claimant), and the Saudi club, Al Batin FC (hereinafter: the club or the Respondent),
concluded a termination agreement in connection with the employment relationship
previously maintained between them (hereinafter: the termination agreement).
2.
In accordance with article 3 of the termination agreement, the club undertook to pay the
player the following amounts:
a.
b.
c.
d.
EUR 66,666 net by 1 July 2021;
EUR 71,667 net in November 2021;
EUR 71,667 net in December 2021; and
EUR 71,667 net in January 2022.
3.
In addition, article 4 of the termination agreement read as follows: “In the event that [the
club] fails to comply with the payment of any of the aforementioned instalments within the
agreed deadline, the player will send a 15-day default notice to the club. In the event that the
club does not comply with the said payment within the 15 days deadline granted, a default
interest penalty at a rate of 5% per month will apply as from the agreed deadlines until the
effective date of payment”.
4.
By letter dated 21 April 2022 and sent on 22 April 2022, the player acknowledged receipt
of a total of EUR 88,946 (i.e. EUR 66,666 + EUR 22,280) under the termination agreement
and granted the club a 15 days’ deadline to pay EUR 192,720 corresponding to
outstanding remuneration.
II. Proceedings before FIFA
5.
On 13 May 2022, the player filed the claim at hand before FIFA. A brief summary of the
position of the parties is detailed in continuation.
a. Position of the player
6.
In his claim, the player confirmed that a balance of EUR 192,720 net remained overdue in
connection with the termination agreement. Consequently, he pointed out that the club
should be liable to pay him the outstanding remuneration and the contractual penalty
established in article 4 of termination agreement.
7.
Specifically regarding the penalty, the player recalled the Swiss Law and the jurisprudence
of the Court of Arbitration for Sport (CAS) and concluded that it was “perfectly reasonable”.
8.
In conclusion, the player requested to be awarded:
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a. EUR 192,720 plus 5% interest p.a. as from the date of default until the full
payment;
b. “default interest penalty at a rate of 5% per month as of the date of default until the
full payment”; and
c. USD 5,000 as legal costs.
9.
Furthermore, he held that sporting sanctions should be imposed on the club in line with
article 12bis of the FIFA Regulations on the Status and Transfer of Players (RSTP).
b. Position of the club
10. On 12 June 2022, the club filed its reply to the player’s claim.
11. In this opportunity, the club acknowledged its debt towards the player, however
maintained that it has always acted in good faith and faced a “significant case of force
majeure” that restrained its ability to perform the payment sub judice.
12. In accordance with the club, it was entitled to a guaranteed financial reward from the
Saudi Sports Ministry that was not delivered as a result of the COVID-19 outbreak.
Consequently, the club requested a “exemption from paying the penalty” stipulated in the
termination agreement.
13. Alternatively, the club argued that the penalty is excessive and should be reduced to 5%
interest p.a. vis-à-vis the jurisprudence of the Dispute Resolution Chamber (DRC) and CAS
on the matter.
14. The requests for relief of the club were as follows (quoted verbatim):
“In the light of all the above and also under consideration of the factual and legal aspects
as outlined in our present position we respectfully request the FIFA, on behalf of Al Batin
Club:
1.2 To accept and grant our requests and issue a decision stating that:
1.2 To establish that the Claimant (sic) (Moreirense Club) is entitled to the amount of the
debt in question amounting to EUR 192,720 without applying any penalty based on our
submitted and evidenced force majeure;
1.3 Alternatively, should any penalty be imposed, it shall be reduced, as being excessive,
to 5% p.a. instead of 5% per month which would make the aggregate penalty
outrageously excessive”.
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c. Unsolicited correspondences dated 23 and 29 June 2022
15. On 13 June 2022, the FIFA general secretariat acknowledged receipt of the club’s reply and
informed the parties that the submission-phase of the case at hand was closed in line
with article 23, par. 1 of the FIFA Procedural Rules Governing the Football Tribunal.
16. On 23 and 29 June 2022, the Claimant filed unsolicited correspondences in connection
with this matter.
III. Considerations of the Dispute Resolution Chamber
a. Competence and applicable legal framework
17. 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 13 May 2022 and submitted
for decision on 4 August 2022. Taking into account the wording of article 34 of the June
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.
18. Subsequently, the members of the Chamber referred to article 2 par. 1 of the Procedural
Rules and observed that in accordance with article 23 par. 1 in combination with article22,
par. 1 lit. b) of the RSTP (July 2022 edition), the DRC is competent to deal with the matter
at stake, which concerns an employment-related dispute with an international dimension
between a Dutch player and a Saudi club.
19. At this point, the DRC recalled that the player filed additional comments on 23 and 29
June 2022, once the submission-phase of the present proceedings was already closed,
and without being invited to do so by the FIFA general secretariat. As a consequence, the
Chamber referred to art. 23 of the Procedural Rules and emphasized that parties to the
proceedings are not authorised to supplement or amend their submissions or requests
for relief or produce new evidence once the submission phase is closed. Therefore, the
DRC established that said submissions were inadmissible.
20. 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 article 26
par. 1 and 2 of the Regulations on the Status and Transfer of Players (July 2022 edition),
and considering that the present claim was lodged on 13 May 2022, the March 2022
edition of said regulations (hereinafter: the Regulations) is applicable to the matter at hand
as to the substance.
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b. Burden of proof
21. The Chamber recalled the basic principle of burden of proof, as stipulated in article 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 article 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
22. 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
23. The foregoing having been established, the Chamber moved to the substance of the
matter, and took note of the fact that the case at hand pertains to a claim for overdue
payables in connection to the termination agreement signed between the parties on 28
June 2021.
24. In this context, the Chamber acknowledged that the principal amount sought by the
player is not contested by the club, who limited its position to the issue of the penalty
clause found in the termination agreement.
25. Therefore, while confirming that the undisputed amounts should be granted to the player
based on the principle pacta sunt servanda, the DRC concluded that its task was to
determine, based on the argumentation of the parties, whether the contractual penalty
should apply or not.
26. On this note, the Chamber firstly turned its attention to the club’s position regarding the
COVID-19 pandemic. By doing so, the DRC highlighted that FIFA issued a set of guidelines,
the COVID-19 Guidelines, which aim at providing appropriate guidance and
recommendations to member associations and their stakeholders, to both mitigate the
consequences of disruptions caused by COVID-19 and ensure that any response is
harmonised in the common interest. Moreover, on 11 June 2020, FIFA has issued an
additional document, referred to as FIFA COVID-19 FAQ, which provides clarifications on
the most relevant questions in connection with the regulatory consequences of the
COVID-19 outbreak and identifies solutions for new regulatory matters.
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27. To this extent, the Chamber observed that the FIFA COVID FAQ, in its question no. 1,
establishes that the Bureau of the FIFA Council did not determine that the COVID-19
outbreak was a force majeure situation in any specific country or territory, or that any
specific employment or transfer agreement was impacted by the concept of force
majeure; rather, it provides that whether or not a force majeure situation (or its equivalent)
exists in the country or territory is a matter of law and fact, which must be addressed on
a case-by-case basis vis-à-vis the relevant laws that are applicable to any specific
employment or transfer agreement.
28. Based on the foregoing, the DRC outlined that the club did not file together with its reply
any documentation pertaining to the question of the COVID-19 pandemic and the concept
of force majeure. Likewise, it recalled that financial difficulties are not a reason per se to
justify the non-compliance of contractual obligations. Consequently, the Chamber
determined that the club failed to meet its burden of proof in accordance with the
aforementioned article 13 par. 5 of the Procedural Rules, hence its argumentation was
rejected.
29. Thereafter, the DRC moved to the analysis of the wording of article 4 of the termination
agreement. In doing so, the members of the Chamber considered that said provision is in
fact a hidden interest clause. What is more, the DRC observed that an interest of 5% per
month would amount to 60% per year, what is disproportionate and excessive in
accordance with the well-established jurisprudence of the Football Tribunal.
30. In conclusion, the DRC decided that the said interest rate should be reduced and
accordingly determined that the player should be entitled to the following amounts:
a. EUR 49,386 net, plus 18% p.a. interest as from 1 December 2021;
b. EUR 71,667 net, plus 18% p.a. interest as from 1 January 2022; and
c. EUR 71,667 net, plus 18% p.a. interest as from 1 February 2022.
31. For the sake of completeness, the Chamber pointed out that no additional “5% default
interest” (as claimed by the player) was applicable, insofar as it would be excessive and
contrary to wording of the termination agreement.
ii. Article 12bis of the Regulations
32. In continuation, the DRC referred to article 12bis par. 2 of the Regulations, which
stipulates that any club found to have delayed a due payment for more than 30 days
without a prima facie contractual basis may be sanctioned in accordance with article 12bis
par. 4 of the Regulations.
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33. To this end, the DRC confirmed that the player put the club in default of payment of the
amounts sought, which had fallen due form more than 30 days, and granted the club with
10 days to cure such breach of contract.
34. The DRC further established that by virtue of article 12bis par. 4 of the Regulations it has
competence to impose sanctions on the club. On account of the above and bearing in
mind that the club is a repeat offender, the DRC decided to impose a fine on the
Respondent in accordance with article 12bis par. 4 lit. c) of the Regulations.
35. Furthermore, the DRC regarded a fine amounting to USD 22,500 as appropriate and
hence decided to impose said fine on the club.
36. In this connection, the DRC wished to highlight that a repeated offence will be considered
as an aggravating circumstance and lead to more severe penalty in accordance with
article 12bis par. 6 of the Regulations.
iii. Compliance with monetary decisions
37. Finally, taking into account the applicable Regulations, the Chamber referred to article 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.
38. 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.
39. 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 article 24 par. 2, 4, and 7 of the Regulations.
40. 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.
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41. 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 article 24 par. 8
of the Regulations.
d. Costs
42. The Chamber referred to article 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.
43. Likewise and for the sake of completeness, the Chamber recalled the contents of article
25 par. 8 of the Procedural Rules, and decided that no procedural compensation shall be
awarded in these proceedings.
44. Lastly, the DRC concluded its deliberations by rejecting any other requests for relief made
by any of the parties.
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IV. Decision of the Dispute Resolution Chamber
1.
The claim of the Claimant, Xandro Dylan Schenk, is partially accepted.
2.
The Respondent, Al Batin FC, has to pay to the Claimant the following amount(s):
a. EUR 49,386 net as outstanding remuneration plus 5% interest p.a. as from 1 December
2021 until the date of effective payment;
b. EUR 71,667 net as outstanding remuneration plus 5% interest p.a. as from 1 January
2022 until the date of effective payment; and
c. EUR 71,667 net as outstanding remuneration plus 5% interest p.a. as from 1 February
2022 until the date of effective payment;
3.
Any further claims of the Claimant are rejected.
4.
Full payment (including all applicable interest) shall be made to the bank account
indicated in the enclosed Bank Account Registration Form.
5.
Pursuant to art. 24 of the Regulations on the Status and Transfer of Players, if full payment
(including all applicable interest) is not made within 45 days of notification of this
decision, the following consequences shall apply:
1. The Respondent shall be banned from registering any new players, either nationally or
internationally, up until the due amount is paid. The maximum duration of the ban
shall be of up to three entire and consecutive registration periods.
2. The present matter shall be submitted, upon request, to the FIFA Disciplinary
Committee in the event that full payment (including all applicable interest) is still not
made by the end of the three entire and consecutive registration periods.
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6.
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.
7.
The Respondent is ordered to pay a fine of USD 22,500 to FIFA within 30 days of the
notification of this decision. Such payment is to be made to the bank account below with
reference to the present proceedings:
UBS Zurich
Account number 230-366677.61N (FIFA Players’ Status)
Clearing number 230
IBAN: CH12 0023 0230 3666 7761 N
SWIFT: UBSWCHZH80A
Please mention the applicable reference number
8.
This decision is rendered without costs.
For the Football Tribunal:
Emilio García Silvero
Chief Legal & Compliance Officer
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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).
CONTACT INFORMATION
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FIFA-Strasse 20 P.O. Box 8044 Zurich Switzerland
www.fifa.com | legal.fifa.com | [email protected] | T: +41 (0)43 222 7777
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