The Dispute Resolution Chamber (hereinafter referred to as "the DRC") had rendered an award dated 25 April 2013 dealing with the definition of a buy-out-clause (hereinafter referred to as "the Decision"). An appeal was brought against the Decision before the Court of Arbitration for Sport (hereinafter referred to as "the CAS").
The case highlighted a conflict between FC Metz (a French football club) and NK Nafta Lendava (a Slovenian football club) regarding the registration of a player. FC Metz claims to have engaged the Player as a free agent whereas NK Nafta considered that it was an international transfer.
The Player was registered by NK Nafta from 8 September 1998 until 30 June 2009 as an amateur, and from 1 July 2009 until 5 October 2011 as a professional. On 25 July 2009, NK Nafta and the Player concluded an employment agreement valid until 30 June 2013. On 1 February 2011, NK Nafta and the Player signed a new employment agreement valid until 30 June 2014.
After facing some financial difficulties, on 31 March 2011, NK Nafta and the Player signed an agreement (hereinafter referred to as the “Settlement Agreement”) in order to amicably settle their contractual relationships. On 12 August 2011, the Player played his last game with NK Nafta.
The Settlement Agreement provided for the payment of EUR 50,000 upon termination of the contract between the Player and NK Nafta, the problem is who was obliged to pay this amount ?
According to the Settlement Agreement and employment agreements, the Player was the only debtor of this obligation to pay. However, it does not seem to be the case since NK Nafta maintained that it was FC Metz who paid the EUR 50,000 to settle the contractual relationships.
So the question is not as simple as appears, in fact the Settlement Agreement is an amicable termination of the contract before the end. Notwithstanding the fact that the Player terminated his contract with NK Nafta before the end, the Settlement Agreement was not performed by the Player but by FC Metz who registered him after the end of the contractual relationships.
Normally when a professional club wants to engage a professional player that has a current contract with another club, the only way is a transfer of the player (transferring definitively the property of the contract, meaning the selling of the player, or transferring temporarily the services of the player, meaning the loan of the player).
So in some cases when a player is transferred, training indemnities are due under Article 2 of Annex 4 of the FIFA Regulations concerning the Status and Transfer of Players (« RSTP ») 2010.
This is a way to get around the transfer of a player, therefore every club will be able to help a player by amicably terminating their contractual relationships and then the club can register the player.
The DRC decision doesn’t allow this mechanism and we have to agree with this position. The DRC decision was as follows : “the DRC held that the training costs are not affected by the aforementioned type of transaction. Therefore, the DRC concluded that training compensation was not included in the amount of EUR 50,000 that the Respondent paid to the Claimant in order to release the player and thus, in principle, training compensation is due”.
First of all, in no way can a club be the debtor of the settlement of the contractual relationships except on behalf of the FIFA regulations of transfer. Second, the CAS mentioned itself in its Decision that « According to CAS jurisprudence, “free agents are players who are free from contractual engagements and for which no transfer fee is paid for their registration by a new club” (CAS 2009/A/1919) ». In fact, transfer fees were paid by FC Metz to register the Player after. So it is not a registration of a free agent. Therefore FC Metz would have been obliged to pay the training compensation.
FC Metz paid a buy-out-clause that the Player and NK Nafta had decided to fix by the Settlement Agreement. It is just another way to establish a buy-out-clause.
Finally, we can understand that there are many ways to circumvent the regulations, and the clubs, with the blessing of the CAS, used every one of these ways against smaller clubs who do not have the power to oppose.
