Labour Disputes
Texto da decisão
REF. FPSD-15346
Decision of the
Dispute Resolution Chamber
passed on 10 October 2024
regarding an employment-related dispute concerning the Player Kevin Varga
BY:
Andre DOS SANTOS MEGALE (Brazil)
CLAIMANT:
Kevin Varga, Hungary
Represented by Kristof Wenczel
RESPONDENT:
Apollon Limassol, Cyprus
Represented by Alkis Papantoniou
pg. 2
REF. FPSD-15346
I. Facts of the case
1. On 15 September 2023, the Hungarian player Kevin Varga (hereinafter the “Claimant” or
“Player”) and the Cypriot club Apollon Limassol (hereinafter the “Respondent” or “Club”)
concluded an employment agreement (hereinafter the “Employment Agreement”), valid as
from 15 September 2023 until 30 June 2024.
2. On 19 January 2024 the parties signed a Termination Agreement, terminating the
Employment Agreement.
3. In the Termination Agreement, the Respondent undertook, inter alia, to pay the Claimant
the following remuneration:
-
EUR 15,761.50 payable 22 January 2024
EUR 9,000 payable 28 February 2024
EUR 8,000 payable 31 March 2024
EUR 8,000 payable 30 April 2024
4. The Termination Agreement further provided as follows:
“In case of any breach of this Termination Agreement, namely in case the Club delays or fails to
pay to the Player the amount(s) indicated above in due time in such a case, upon condition and
prior of a written notice to be sent by email, giving a term of seven (7) days to pay the outstanding
amount(s) due, the Club undertakes to pay €50 penalty for each day of the delay.”
5. On 24 January 2024 the Respondent paid the first instalment of EUR 15,761.50.
6. On 8 March 2024 the Claimant sent a notice of default to the Respondent, requesting the
payment of a net total of EUR 9,000, providing the Respondent 7 days to cure the default.
The Claimant further provided in the notice that in the absence of payment, a EUR 50 daily
penalty shall apply for each day of delay pursuant to the Termination Agreement.
7. Another payment notice was sent by the Claimant on 17 May 2024, providing the
Respondent 7 days to cure the default, for the following outstanding remuneration:
-
EUR 9,000 payable 28 February 2024
EUR 8,000 payable 31 March 2024
EUR 8,000 payable 30 April 2024
EUR 3,200 representing a daily EUR 50 penalty for each day delay from 15 March 2024
until the day of said notice
pg. 3
REF. FPSD-15346
II. Proceedings before FIFA
8. On 24 July 2024, the Claimant filed the claim at hand before FIFA. A summary of the parties’
position is detailed below.
a. Position of the Claimant
9. According to the Claimant, the Respondent owed outstanding remuneration from the
Termination Agreement, as well as penalty fees.
10. The requests for relief of the Claimant, were the following:
“In accordance with Section 2 and 4 of the Termination Agreement please oblige the
Respondent Club to pay:
(i) € 25.000,- (twenty-five thousand Euro) (the sum of the outstanding three installments of
€ 9.000,-, € 8.000,- and € 8.000)
(ii) a daily €50 penalty for each day of delay from 15 March 2024 until the effective date
of the entire payment, in accordance with Section C.4. of the Termination. (Accordingly a
total sub of daily penalty of € 6.550,- is due until today (131 days of delay)
(iii) the reimbursement of the Player’s legal costs and fees arisen by the late payment of
the Respondent Club of € 1.800,(iv) 5% p.a. late payment interest rate after the outstanding three installments from the
dates of expiring the related payment deadlines in accordance with section 2 of the
Termination Agreement:
- for the 1st outstanding instalment as of 29th February 2024
- for the 2nd outstanding instalment as of 1st April 2024
- for the 3rd outstanding instalment as of 1st May 2024
until the effective payment date of the claim above.
[request for relief]
Please oblige the Respondent Club of payment of the net amount
€33.350,(in words thirty-three thousand and three hundred fifty Euro)
as of today and a
daily €50
for the period from today until the effective date of the payment
and
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REF. FPSD-15346
5% p.a. late payment interest rate
after the outstanding three installments until the effective date of the payment.
Additionally oblige the Respondent Club to provide the adequate tax certificate.”
b. Position of the Respondent
11. In its reply, the Respondent did not dispute that the four payments were payable pursuant
to the Termination Agreement for a total of EUR 40,761.50.
12. The Respondent confirmed it paid EUR 15,761.50 and argued that it also made a payment
of EUR 9,000 to the Claimant on 22 May 2024, thereby rejecting the claim relating to the
EUR 9,000 payment.
13. The Respondent further argued that the daily EUR 50 penalty constituted a hidden interest
clause and further that the clause imposed an excessive interest for outstanding payments
which pursuant to FIFA jurisprudence should be capped at 18% per annum.
14. The Respondent further rejected the Claimant’s request for 5% interest per annum on the
past due amounts, stating that the EUR 9,000 payment was made and that adding the
payment to the EUR 50 daily fee further underscored the excessiveness of the interest
amount.
15. Moreover, the Respondent rejected the request for EUR 1,800 citing art. 25 par. 8 of the
Procedural Rules Governing the Football Tribunal.
16. Finally, the Respondent rejected the Claimant’s request for tax certificates arguing that the
request was ungrounded and lacked necessary precision for the DRC’s consideration.
17. The Respondent requested the following of the DRC:
“A. To find that the amount requested by the Claimant is wrong and reject his claim;
B. To determine that the amount of EUR 9,000 corresponding to the second instalment of the
Termination Agreement has been paid to the Claimant.
C. To reject the claim of the Claimant for the imposition of a penalty of EUR 50.00 per day, as a
hidden interest and to limit his claim to the default interest of 5% p.a., as described in (D) below;
D. To reject the claim of the Claimant for the application of a 5% interest p.a. on the three
instalments as from the dates of payment and consider that the 5% interest p.a. shall be
calculated on the outstanding amount of EUR 16,000 from the day the Claimant submitted the
Claim
pg. 5
REF. FPSD-15346
E. To reject the claim of the Claimant concerning the submission of tax certificates”.
c. Additional Comments of the Claim
18. Upon invitation to provide comments on the payment of EUR 9,000, the Claimant
confirmed receipt of the EUR 9,000 and submitted the following amended claim:
In accordance with Section 2 and 4 of the Termination Agreement please oblige the Respondent
Club to pay:
(i) € 25.000,- (twenty-five thousand Euro) € 16.000 (sixteen thousand Euro) (the sum of the
outstanding three two installments of € 9.000,-, € 8.000,- and € 8.000)
(ii) a daily €50 penalty for each day of delay from 15 March 2024 until the effective date of the
entire payment, in accordance with Section C.4. of the Termination. (Accordingly a total sub of daily
penalty of € 6.550,- is due until today the day of the submission of the claim (07-24-2024) (131
days of delay)
(iii) the reimbursement of the Player’s legal costs and fees arisen by the late payment of the
Respondent Club of € 1.800,[...]
(iv) 5% p.a. late payment interest rate after the outstanding three installments from the dates of
expiring the related payment deadlines in accordance with section 2 of the Termination Agreement:
- for the 1st outstanding instalment as of 29th February 2024 until 22 May 2024
- for the 2nd outstanding instalment as of 1st April 2024
- for the 3rd outstanding instalment as of 1st May 2024
until the effective payment date of the claim above.
[request for relief]
Please oblige the Respondent Club of payment of the net amount
€33.350, €24.500,(in words thirty-three thousand and three hundred fifty Euro twenty-four thousand five
hundred Euro)
as of today and a
daily €50
for the period from today until the effective date of the payment
and
5% p.a. late payment interest rate
after the outstanding three installments until the effective date of the payment.
pg. 6
REF. FPSD-15346
19. The Claimant also provided additional unsolicited comments outside the scope of FIFA’s
invitation for Additional Comments.
pg. 7
REF. FPSD-15346
III. Considerations of the Dispute Resolution Chamber
a. Competence and applicable legal framework
20. First of all, the Single Judge (hereinafter: the Single Judge) analysed whether he was
competent to deal with the case at hand. In this respect, he took note that the present
matter was presented to FIFA on 24 July 2024 and submitted for decision on 10 October
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.
21. Furthermore, the Single Judge referred to art. 2 par. 1 of the Procedural Rules and observed
that in accordance with art. 23 par. 1 in combination with art. 22 par. 1 lit. b) of the
Regulations on the Status and Transfer of Players (June 2024 edition), the Single Judge is
competent to deal with the matter at stake, which concerns an employment-related
dispute with an international dimension between a Hungarian player and a Cypriot club.
22. Subsequently, the Single Judge analysed which regulations should be applicable as to the
substance of the matter. In this respect, he confirmed that, in accordance with art. 26 par.
1 and 2 of the Regulations on the Status and Transfer of Players (June 2024 edition), and
considering that the present claim was lodged on 24 July 2024, the June 2024 edition of
said regulations (hereinafter: the Regulations) is applicable to the matter at hand as to the
substance.
b. Burden of proof
23. The Single Judge 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 Single Judge
stressed the wording of art. 13 par. 4 of the Procedural Rules, pursuant to which he 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. Having established the competence and the applicable regulations, the Single Judge
entered into the merits of the dispute. In this respect, the Single Judge started by
acknowledging all the above-mentioned facts as well as the arguments and the
documentation on file. However, the Single Judge emphasised that in the following
considerations it will refer only to the facts, arguments and documentary evidence, which
he considered pertinent for assessing the matter at hand.
pg. 8
REF. FPSD-15346
i. Main legal discussion and considerations
25. The Single Judge then moved to the substance of the matter, and preliminarily took note
of the fact that the parties did not dispute that a valid agreement existed between the
parties, the Termination Agreement, pursuant to which the Respondent undertook to pay
the Claimant a total of EUR 40,761.50 in four instalments.
26. The Single Judge further observed that that both parties’ submissions supported the fact
that, as of 22 May 2024, the Respondent had paid EUR 24,761.50 of its financial obligation
and that EUR 16,000 of the payments remained outstanding.
27. In this context, the Single Judge acknowledged that the parties strongly disputed the
additional relief sought by the Claimant, namely:
-
the daily EUR 50 penalty fees as from 15 March 2024 until 24 July 2024, plus the EUR
50 daily penalty fee as from 30 August 2024 (the date of the amended claim);
-
5% interest per annum on the one late (EUR 9,000) and two outstanding (2 x EUR
8,000) instalments as from the date following the due dates until the date of
effective payment;
-
the cost of legal fees in the amount of EUR 1,800; and
-
the request for the Respondent to furnish adequate tax certificates.
Interest and Penalty
28. With regard to the daily EUR 50 penalty fee and the additional 5% interest, the Single Judge
recalled the Respondent’s argument that the daily penalty fee constitutes a hidden interest
clause because the amount increases with non-payment over time and found that such
argument was in line with established FIFA jurisprudence.
29. The Single Judge reverted to the Respondent’s argument that the interest as claimed by the
Claimant would well exceed the maximum interest rate deemed reasonable and
proportionate based on established FIFA jurisprudence (up to 18% per annum). In this
respect, the Single Judge took into account that the daily rate plus 5% interest requested
would equal to approximately EUR 19,050 per annum, which would be an equivalent of
76.2% per annum of the outstanding and late amounts (EUR 25,000).
30. Consequently, the Single Judge determined that, in lieu of the penalty fee plus interest
requested by the Claimant, the award should be only up to 18% per annum interest as from
the day after the due date until the date of effective payment.
pg. 9
REF. FPSD-15346
18. The Single Judge highlighted that, while the payment of USD 9,000 was confirmed as paid,
both parties confirmed that the payment was made on 22 May 2024, i.e., after the due date.
Consequently, the Single Judge found it appropriate that interest be awarded on this late
payment as well, as requested by the Claimant in his amended request for relief, but
subject to the revised rate as noted above.
Legal Fees and Costs
31. The Single Judge further noted that, as raised by the Respondent, the Claimant’s request
for EUR 1,800 for the cost of legal fees should not be granted (cf. art. 25 par. 6 of the
Procedural Rules).
32. For the sake of completeness, the Single Judge noted that the Claimant’s additional
comments submitted by the Claimant in this respect were inadmissible (cf., art. 23, par. 2
of the Procedural Rules).
Tax Certificates
33. The Single Judge noted that the Termination Agreement did not provide any requirement
for the Respondent to provide “adequate tax certificates” nor any ancillary obligation that,
on its face, would necessitate the Respondent to provide this information. Therefore, the
Single Judge rejected the Claimant’s request to provide said tax certificates.
ii. Consequences
34. Therefore, according to the principle of pacta sunt servanda, the Single Judge concluded
that the Respondent failed to meet financial obligations under the Termination Agreement
and owed the remuneration which follows in continuation.
35. The Single Judge observed that the outstanding remuneration arising from the Termination
Agreement, coupled with the specific requests for relief of the player, are equivalent to EUR
16,000, representing the EUR 8,000 payment instalment due 31 March 2024 and the EUR
8,000 payment instalment due 30 April 2024.
36. As a consequence, and in accordance with the general legal principle of pacta sunt servanda,
the Single Judge decided that the Respondent is liable to pay to the Claimant the amounts
which were outstanding under the Termination Agreement.
37. In addition, taking into consideration the considerations above, the Claimant’s request, as
well as the constant practice of the DRC in this regard, the Single Judge decided to award
the Claimant interest at the rate of 18% p.a. on the outstanding amounts, and on the late
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REF. FPSD-15346
payment of EUR 9,000, as from the day following their respective due dates until the date
of effective payment.
iii. Compliance with monetary decisions
38. Finally, taking into account the applicable Regulations, the Single Judge referred to art. 24
par. 1 and 2 of the Regulations, which stipulate that, with his 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.
39. In this regard, the Single Judge 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.
40. Therefore, bearing in mind the above, the Single Judge decided that the Respondent must
pay the full amount due (including all applicable interest) to the Claimant within 45 days of
notification of the decision, failing which, at the request of the Claimant, 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 Respondent in accordance with art. 24 par. 2, 4, and 7 of the Regulations.
41. The Respondent shall make full payment (including all applicable interest) to the bank
account provided by the Claimant in the Bank Account Registration Form, which is attached
to the present decision.
42. The Single Judge 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
43. The Single Judge 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 Single Judge decided that no procedural costs were to be
imposed on the parties.
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REF. FPSD-15346
44. Likewise, and for the sake of completeness, the Single Judge recalled the contents of art.
25 par. 8 of the Procedural Rules and decided that no procedural compensation shall be
awarded in these proceedings.
45. Lastly, the Single Judge concluded his deliberations by rejecting any other requests for
relief made by any of the parties.
pg. 12
REF. FPSD-15346
IV. Decision of the Dispute Resolution Chamber
1.
The claim of the Claimant, Kevin Varga, is partially accepted.
2.
The Respondent, Apollon Limassol, must pay to the Claimant the following amount(s):
- 18% interest on EUR 9,000 p.a. as from 29 February 2024 until 22 May 2024;
- EUR 8,000 as outstanding remuneration plus 18% interest p.a. as from 1 April 2024 until
the date of effective payment;
- EUR 8,000 as outstanding remuneration plus 18% interest p.a. as from 1 May 2024 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.
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
pg. 13
REF. FPSD-15346
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 – Legal & Compliance Division
396 Alhambra Circle, 6th floor, Coral Gables, Miami, Florida, USA 33134
legal.fifa.com | [email protected] | T: +41 (0)43 222 7777
pg. 14