Labour Disputes
Texto da decisão
REF FPSD-6403
Decision of the
Dispute Resolution Chamber
passed on 1 September 2022
regarding an employment-related dispute concerning the player Ole
Kristian Selnaes
COMPOSITION:
DE WEGER, Frans (The Netherlands), Chairperson
ANDRADE, José Luis (Portugal), Member
GOMEZ BRUINEWOUD, Alexandra (Uruguay & The Netherlands), Member
CLAIMANT:
Ole Kristian Selnaes, Norway
Represented by Anna Smirnova
RESPONDENT:
Shenzhen FC, China PR
Represented by Tomas Pereda Rueda and Roy Chu
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I. Facts of the case
1.
On 1 February 2019, the Norwegian player, Mr Ole Kristian Selnaes (hereainfter: the player
or the Claimant), and the Chinese club, Shenzhen Football Club (hereinafter: the club or
the Respondent), concluded an employment contract valid as from the date of signature
until 30 January 2023 (hereinafter: the employment contract).
2.
In accordance with article 2 of the employment contract, the player would be entitled,
inter alia, to the following amounts:
a. From 1 February 2019 until 31 January 2020: EUR 7,042,209 (EUR 3,900,000
net) as annual salary, payable as follows:
(i)
EUR 909,000 (EUR 500,000 net) as advance payment by no later than
1 June 2019; and
(ii)
EUR 6,133,119 (EUR 3,400,000 net) in 12 equal monthly instalments
each one to be paid on the 15th day of the next month.
b. From 1 February 2020 until 31 January 2021: EUR 7,224,027 (EUR 4,000,000
net) as annual salary;
c. From 1 February 2021 until 31 January 2022: EUR 7,769,482 (EUR 4,300,000
net) as annual salary; and
d. From 1 February 2022 until 30 January 2023: EUR 7,769,482 (EUR 4,300,000
net) as annual salary.
3.
Finally, articles 7.3 (1) and 8.1 of the employment contract respectively read as follows:
“7.3. [The player] may terminate the Contract and receive compensation from [the club] in
the following cases:
(1) If [the club] is in default of payment of salary to [the player] for more than two months
and [the club] notifies in written to [the club] and [the club] does not remedy such default
within 15 (fifteen) days upon notification.
[…] 8.1. In case [the player] terminates the Contract without just cause, [the club] shall
compensate [the player] which amounts to 50% (fifty percent) of the remaining salary of this
Contract as compensation”.
4.
On 12 April 2021, the player, the club, and Hebei Football Club (hereinafter: Hebei) entered
into a loan agreement, by means of which the player was temporarily transferred from
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the club to Hebei from the date of signature until 31 December 2021 (hereinafter: the loan
agreement).
5.
Clause 1 of the loan agreement read, inter alia, as follows: “It is explicitly agreed that no fee
is charged to [Hebei] by [the club] for the temporary transfer of the player’s registration. [The
club] confirms to the player that it will continue to pay the remunerations to the player during
the loan period”. (emphasis in the original)
6.
On 16 February 2022, the player put the club in default and requested payment of EUR
1,791,665 by 5 March 2022 (i.e. 17 days), corresponding to his salaries from September
2021 until January 2022 (EUR 358,333 each). He referred to articles 14 and 14bis of the
FIFA Regulations on the Status and Transfer of Players (RSTP), as well as clause 7.3 (1) of
the employment contract.
7.
On 16 March 2022, the player sent the club a second default letter by means of which he
acknowledged that no payment had been received and added that his salary of February
2022 was also overdue. The player granted the club additional 15 days to remedy its
breach.
8.
On 19 April 2022, the player sent the club a third default letter by means of which he
acknowledged that no payment had been received and added that his salary of March
2022 was also overdue. The player granted the club additional 15 days to remedy its
breach.
9.
On 6 May 2022, the player notified the club of the termination of the employment contract
due to overdue payables (i.e. the salaries from September 2021 until March 2022).
10. On 22 June 2022, the player entered into a new employment agreement with the Swiss
club, FC Zurich, valid as from the same date until 30 June 2023. According to the relevant
contract, the player would be entitled, inter alia, to a fixed monthly remuneration of CHF
25,000.
II. Proceedings before FIFA
11. On 17 June 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
12. According to the player, the club failed to honour its financial duties giving cause to the
premature termination of their employment relationship. The player furthermore
recalled the content of clause 1 of the loan agreement and highlighted that the club would
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still be liable to pay his salaries during the loan period but failed to do so as from
September 2021.
13. As a result, the player referred his default letters and termination letter, as well as to art.
14bis of the FIFA RSTP. Therefore, the player claimed the following amounts:
a.
EUR 5,309,146.01 as outstanding remuneration, broken down as follows:
(i)
EUR 647,456.83 (salary for September 2021) plus 5% interest p.a. as from 16
October 2021;
(ii) EUR 647,456.83 (salary for October 2021) plus 5% interest p.a. as from 16
November 2021;
(iii) EUR 647,456.83 (salary for November 2021) plus 5% interest p.a. as from 16
December 2021;
(iv) EUR 647,456.83 (salary for December 2021) plus 5% interest p.a. as from 16
January 2022;
(v) EUR 647,456.83 (salary for January 2022) plus 5% interest p.a. as from 16
February 2022;
(vi) EUR 647,456.83 (salary for February 2022) plus 5% interest p.a. as from 16
March 2022;
(vii) EUR 647,456.83 (salary for March 2022) plus 5% interest p.a. as from 16 April
2022;
(viii) EUR 647,456.83 (salary for April 2022) plus 5% interest p.a. as from 16 May
2022; and
(ix) EUR 129,491.37 (pro rata salary for May 2022) plus 5% interest p.a. as from
7 May 2022.
b.
EUR 5,697,620.11 as compensation for breach of contract, corresponding to the
residual value of the employment contract (i.e. EUR 517,965.47 as the pro rata
salary of May 2022, plus 8 * EUR 647,456.83 for the salaries between June 2022
and January 2023), plus 5% interest p.a. as from 7 May 2022.
14. Finally, the player requested sporting sanctions to be imposed on the club in line with art.
17, par. 4 of the FIFA RSTP.
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b. Position of the club
15. On 7 July 2022, the club filed its reply to the player’s claim.
16. Initially, the club explained that as from October 2021 it “had its income significantly
reduced sue to the financial crisis of its shareholder Kaisa Group Holdings Ltd.”, triggering a
force majeure situation. In this respect, the club pointed out that it was in regular contact
with the player’s agent to terminate the employment contract, but no amicable solution
was ever reached.
17. In view of the foregoing, the club challenged the player’s claim to compensation for
breach of contract. It argued that article 8 of the employment contract was valid and
binding to the parties, especially considering the financial crisis as a mitigation
circumstance. The club also referred to Swiss Law and the jurisprudence of FIFA and the
Court of Arbitration for Sport (CAS) on the matter, and concluded that the amount of
compensation would be reasonable and proportionate.
18. Alternatively, the club argued that the compensation should be mitigated as per the
player’s new employment with FC Zurich. It also maintained that no sporting sanctions
should be applied.
19. The club’s requests for relief were as follows, in verbis:
“In view of all the factual and legal arguments mentioned above, [the club] hereby requests
the FIFA Tribunal to:
i.
Rule that the present submissions are admissible;
ii.
Confirm that Article 8 of the Contract is valid and thus, that the Respondent shall pay a
compensation limited toa maximum amount equal to 50% of the remaining value under
the employment contract, considering also the mitigating circumstances exposed in the
submissions;
iii.
Order the Claimant to disclose any employment agreement that he might have entered
with a new club or that he might enter during these proceedings and, in such case, mitigate
the new salaries from the compensation to be paid by the Respondent;
iv.
Determine that no sporting sanctions shall be applied to the Respondent;
v.
To the extent that any costs of these proceedings are to be paid by the parties, rule that
Claimant shall be responsible for payment of such costs.
Alternatively, in case FIFA rules that Article 8 is not applicable to this case:
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i.
Order the Claimant to disclose any employment agreement that he might have entered
with a new club or that he might enter during these proceedings;
ii.
Mitigate any potential compensation with the new salaries received by the Player from a
new club, as well as any other mitigating factor to be determined by the FIFA Tribunal as
exposed in these submissions;
iii.
Determine that no sporting sanctions shall be applied to the Respondent;
iv.
To the extent that any costs of these proceedings are to be paid by the parties, rule that
Claimant shall be responsible for payment of such costs”.
III. Considerations of the Dispute Resolution Chamber
a. Competence and applicable legal framework
20. 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 17 June 2022 and submitted
for decision on 01 September 2022. Taking into account the wording of art. 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.
21. Subsequently, the members of the Chamber referred to art. 2 par. 1 of the Procedural
Rules and observed that in accordance with art. 23 par. 1 in combination with art. 22, par.
1 lit. b) of the RSTP (July 2022 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 Norwegian player and a Chinese club.
22. 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 (July 2022 edition), and
considering that the present claim was lodged on 17 June 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
23. 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
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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
24. 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
25. 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 outstanding
remuneration and compensation for breach of contract lodged by the player against the
club in connection to the employment relationship previously maintained between them.
26. In this context, the Chamber acknowledged that it remained undisputed between the
parties that (i) the player terminated the employment contract on 6 May 2022 due to
overdue payables; and (ii) said termination took place with just cause, what was also
confirmed by the DRC on the basis of art. 14bis of the FIFA Regulations insofar as more
than two salaries were outstanding, and the player had already put the club in default in
three different opportunities granting it reasonable deadlines of 15 days at least to
remedy the breach, to no avail.
27. In light of foregoing, the Chamber confirmed that its task was limited to assess the
consequences of the club’s breach, as follows.
ii. Consequences
28. Having established the above, the DRC initially took due consideration that the
outstanding remuneration at the time of termination, coupled with the specific requests
for relief of the player, is equivalent to 8 salaries under the employment contract (i.e. from
October 2021 until April 2022).
29. As a consequence, and in accordance with the general legal principle of pacta sunt
servanda, the Chamber decided that the club shall be liable to pay the player the
abovementioned concepts totalling EUR 5,179,654.64 (i.e. EUR 647,456.83 * 8).
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30. In addition, 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 at the rate of 5%
p.a. on the outstanding amounts as from the respective due dates until the date of
effective payment.
31. 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.
32. 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.
33. In this regard, and as raised by the club, the Chamber took note of the wording of article
8.1 of the employment contract, which established that “In case [the player] terminates the
Contract without just cause, [the club] shall compensate [the player] which amounts to 50%
(fifty percent) of the remaining salary of this Contract as compensation”.
34. After analysing the content of the aforementioned provision, the Chamber concluded that
it only establishes the amount of compensation due by the club to the player in case the
employment contract was terminated without just cause by the club, what was not the case
in this dispute. Furthermore, the DRC was also of the opinion that said provision is clearly
non-reciprocal, therefore could not be applied in line with the longstanding jurisprudence
of the Football Tribunal.
35. As a consequence, 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.
36. 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 EUR 5,827,111.47 (i.e. the player’s salaries from May 2022
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until January 2023) serves as the basis for the determination of the amount of
compensation for breach of contract.
37. 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.
38. Indeed, the player found employment with FC Zurich. In accordance with the pertinent
employment contract, the player was entitled to CHF 25,000 per month. Therefore, the
Chamber concluded that the player mitigated his damages in the total amount of EUR
178,344.76, that is the pro rata salary of June 2022, plus the salaries from July 2022 until
January 2023.
39. 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 contract
termination took place due to said reason i.e. overdue payables by the club, and therefore
decided that the player shall receive additional compensation.
40. In parallel, while assessing the quantum of additional compensation to be awarded to the
player, the Chamber recalled that, as per the last sentence of art. 17 par. 1 lit. ii) of the
Regulations, the overall compensation may never exceed the rest value of the
prematurely terminated contract.
41. Therefore, the DRC decided to award the player of EUR 178,344.76 as additional
compensation.
42. Subsequently, the DRC turned its attention to the club’s argumentation as to the financial
crisis of its shareholders as a mitigation factor for the calculation of the compensation.
Accordingly, the Chamber was firm to determine that the club’s position lacks legal and
contractual basis. Moreover, the Chamber concurred that the mere fact that the club
provided evidence of financial difficulties is not sufficient to establish per se that it faced
a force majeure situation capable of mitigating its contractual obligations. Likewise and
also as opposed to the club’s argumentation in this respect, the DRC stressed that the fact
that the player was entitled to high salaries is also not relevant to this extent.
43. 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 EUR 5,827,111.47 to
the player (i.e. EUR 5,827,111.47 minus EUR 178,344.76 plus EUR 178,344.76), which was
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to be considered a reasonable and justified amount of compensation for breach of
contract in the present matter.
44. 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 the player interest on said
compensation at the rate of 5% p.a. as of 17 June 2022 until the date of effective payment.
iii. Compliance with monetary decisions
45. 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.
46. 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.
47. 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.
48. 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.
49. 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
50. 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.
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51. 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.
52. 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, Ole Kristian Selnaes, is partially accepted.
2.
The Respondent, Shenzhen FC, has to pay to the Claimant the following amounts:
- EUR 647,456.83 as outstanding remuneration plus 5% interest p.a. as from 16 October
2021 until the date of effective payment;
- EUR 647,456.83 as outstanding remuneration plus 5% interest p.a. as from 16 November
2021 until the date of effective payment;
- EUR 647,456.83 as outstanding remuneration plus 5% interest p.a. as from 16 December
2021 until the date of effective payment;
- EUR 647,456.83 as outstanding remuneration plus 5% interest p.a. as from 16 January
2022 until the date of effective payment;
- EUR 647,456.83 as outstanding remuneration plus 5% interest p.a. as from 16 February
2022 until the date of effective payment;
- EUR 647,456.83 as outstanding remuneration plus 5% interest p.a. as from 16 March
2022 until the date of effective payment;
- EUR 647,456.83 as outstanding remuneration plus 5% interest p.a. as from 16 April 2022
until the date of effective payment;
- EUR 647,456.83 as outstanding remuneration plus 5% interest p.a. as from 16 May 2022
until the date of effective payment; and
- EUR 5,827,111.47 as compensation for breach of contract without just cause plus 5%
interest p.a. as from 17 June 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:
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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.
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.
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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