Professional Football Club Botev Plovdiv v. Club Madenat Alamal arbitration award Lausanne; Contested 50% of future sale proceeds

CAS 2024/A/10849 Professional Football Club Botev Plovdiv v. Club Madenat Alamal Football Club

ARBITRAL AWARD delivered by the COURT OF ARBITRATION FOR SPORT sitting in the following composition: President: Mr Francesco Macrì, Attorney-at-law in Piacenza, Italy Arbitrators: Mr Attila Berzeviczi, Attorney-at-law in Budapest, Hungary Mr Kepa Larumbe, Attorney-at-Law in Madrid, Spain

In the arbitration between Professional Football Club Botev Plovdiv, Plovdiv, Bulgaria Represented by Mr Davor Lazic, Attorney-at-Law in Zagreb, Croatia

  • Appellant - and Club Madenat Alamal Football Club, Dubai, United Arab Emirates Represented by Mr Tomas Francesc Gea, Attorney-at-Law in Barcelona, Spain

  • Respondent –

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Palais de Beaulieu Av. Bergières 10 CH-1004 Lausanne Tel: +41 21 613 50 00 Fax: +41 21 613 50 01 www.tas-cas.org I. PARTIES 1. Professional Football Club Botev Plovdiv (the “Appellant” or “Botev”) is a Bulgarian professional football club with its registered seat in Plovdiv, Bulgaria. It is a member of the Bulgarian Football Union (“BFS”), which in turn is affiliated with the Fédération Internationale de Football Association (“FIFA”). 2. Club Madenat Alamal Football Club (the “Respondent” or “Madenat”) is an Emirati professional football club with its registered seat in Dubai, United Arab Emirates. It is a member of the United Arab Emirates Football Association (“UAE FA”), which in turn is affiliated with the Fédération Internationale de Football Association (“FIFA”). 3. The Appellant and the Respondent are hereinafter jointly referred to as the “Parties”. II. FACTUAL BACKGROUND 4. Below is a summary of the main relevant facts, as established on the basis of the written submissions of the Parties, the hearing, and the evidence examined in the course of the proceedings. This background information is given for the sole purpose of providing a summary of the dispute. Additional facts may be presented, where relevant, in conjunction with the legal analysis. A. Background Facts 5. On 26 August 2021, PFC Botev Plovdiv and Madenat Alamal Football Academy (the “Academy”), later changed its name to “Madenat Alamal Football Club”, signed a contract (the “Transfer Agreement”) for the transfer of the Nigerian player, Tochukwu Nnadi (the “Player”) from the Appellant to the Respondent. In this regard, according to Article 1 of the Transfer Agreement, the Parties agreed that Madenat “will give the (necessary) permission to the Football Association involved to issue the International Transfer Certificate (ITC) for the international transfer of the Player from the Academy to PFC Botev Plovdiv”. 6. Concerning the financial terms of the Transfer Agreement, Article 2 (“Indemnification Amount”) states as follows: “2.1 MADENAT ALAMAL FOOTBALL ACADEMY will transfer 100% (one hundred per cent) of the rights of the player to PFC Botev Plovdiv for the amount of 7,000 EURO (seven thousand euro).

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Palais de Beaulieu Av. Bergières 10 CH-1004 Lausanne Tel: +41 21 613 50 00 Fax: +41 21 613 50 01 www.tas-cas.org 2.2 MADENAT ALAMAL FOOTBALL ACADEMY shall receive 50% (fifty per cent) of the net transfer fee received by PFC Botev Plovdiv in case of a future sale of the player to a third club.” 7. On 13 August 2021, Botev and the Player signed an employment contract (the “Labour Contract”), where it is stated in preliminary declarations, “that the PLAYER has agreed with the former club and the CLUB to be permanently transferred to the latter”. Further, an “Additional Agreement to the Labour Contract of Professional Football Player no. 471/13.08.2021 (the “Additional Agreement”) was signed by the same parties that provides as follows: “The CLUB and the PLAYER agree only in one point as follows:

  • In case of sale of the player to a third club, THE PLAYER is entitled to receive a 50% of the net amount of money received by THE CLUB.

On 31 August 2021, Botev and Madenat signed a “Contract on Financial Donation” (“the Donation”), in which the Parties were respectively named the first as the “Donor” and the second as the “Beneficiary”. This agreement reads as follows:

  1. The object of the Contract is a financial donation from the Donor totalling 7,000 Euro (in words,“seven thousand Euro”), which the Donor dedicates to the Beneficiary for the purpose of:
  • supporting the development of players of the academy project of Madenat Alaman Football Academy.
  1. According to the agreement of the contractual parties, the donation will be paid to the Beneficiary’s Account indicated in Article 1 above as follows:
  • 7 000 euro no later than 30 September 2021.
  1. The parties of the Contract had additionally agreed that the Donor’s obligation to complete the Contract shall be conditional upon the following material condition being fulfilled (the “Condition Precedent”):
  • the Player Tochukwu Nnadi, a professional football player of Nigerian nationality, born on 30/06/2003, passport B00314271 will be transferred from Madenat Alaman Football Academy to PFC Botev Plovdiv. If the Condition Precedent has not been satisfied this Agreement shall automatically be null and void and Beneficiary is obliged to return to Donor all donations effectively received under present Contract of financial donation within ten business days after receipt of corresponding request from Donor”.

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Palais de Beaulieu Av. Bergières 10 CH-1004 Lausanne Tel: +41 21 613 50 00 Fax: +41 21 613 50 01 www.tas-cas.org 9. On 22 October 2021 and 22 November 2021, by means of two subsequent bank transfer orders, Botev paid Madenat the amount agreed upon in the Donation. The transfer description for both payments reads: “Contract on Financial 31 August 2021 Payment of 50 per cent”. 10. On 1 December 2022, Botev and the Player concluded a new employment contract with a different remuneration, which preliminarily provides: “CONSIDERING THAT: A. The PLAYER declares that he is currently a free agent and all the previous contracts with other clubs have been officially terminated…” 11. On 9 January 2024, the Player was transferred from Botev to the Belgian club S.V. Zulte Waregem, where, inter alia, this was stated in that agreement: “2.1. In consideration for the definitive transfer of the Player, the Buying Club shall pay to the Selling Club a fee of 750.000,00 EUR (seven hundred fifty thousand euro) (hereinafter the “Transfer Fee”), exclusive of Value Added Tax.

[…]

2.3. The Transfer Fee will be payable, taking into account the following payment schedule:

2.3.1. Payment will be done at latest 10 days 250.000,00 EUR after the Transfer Conditions are met:

2.3.2. By 15th July 2024: 250.000,00 EUR

2.3.3. By 15th January 2025: 250.000,00 EUR” 12. On 8 January 2024, prior to the transfer to Zulte Waregem, Plovdiv and the Player signed an “Agreement to waive transfer fee entitlement” stipulating the following: A. The Player is currently employed by the Club under a labor contract dated 05.12.2022. B. As per an additional agreement to the labor contract, the Club is obligated to pay the Player 50% of any transfer fee received in the event of the Player’s transfer to another club. C. The Player has agreed to waive his right to receive the aforementioned 50% of the transfer fee in the event of his transfer from the Club.

NOW, THEREFORE, IT IS HEREBY AGREED AS FOLLOWS:

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Palais de Beaulieu Av. Bergières 10 CH-1004 Lausanne Tel: +41 21 613 50 00 Fax: +41 21 613 50 01 www.tas-cas.org

  1. Waiver of Transfer Fee Entitlement The Player hereby irrevocably waives his right to receive 50% of the transfer fee as stipulated in the additional agreement to his labor contract with the Club.

  2. No Entitlement The Player acknowledges that he shall have no entitlement to any part of the transfer fee received by the Club in the event of his transfer to another club.

  3. Full and final settlement The Player confirms that the waiver of the transfer fee entitlement is a full and final settlement of any claims he may have in relation to the said entitlement.

  4. Governing Law and Jurisdiction Any disputes arising out of or in connection with this Agreement shall be subject to the exclusive jurisdiction of CAS.

  5. Entire Agreement This Agreement is an integral part of the Employment agreement No 62 and it supersedes all prior negotiations, agreements, and understandings between them, whether written or oral, relating to this subject matter.

  6. This agreement comes into force when the transfer agreement regarding the Player between the Club and another club is signed […]”.

According to the Transfer Matching System (TMS), the Player was first transferred from the Nigerian football club Campos Football Academy to Botev, and then from Botev to S.V. Zulte Waregem. 14. On 13 February 2024, Madenat put Botev in default and requested payment of 50% of the transfer fee for the Player to S.V. Zulte Waregem, but did not receive a positive response. B. Proceedings before the FIFA Players’ Status Chamber 15. On 18 February 2024, Madenat filed a claim against Botev before the FIFA Players’ Status Chamber (the “FIFA PSC”). 16. Botev submitted its reply to the FIFA PSC on 29 May 2024. 17. On 4 June 2024 and on 10 June 2024, the Parties filed their replica and duplica, respectively.

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Palais de Beaulieu Av. Bergières 10 CH-1004 Lausanne Tel: +41 21 613 50 00 Fax: +41 21 613 50 01 www.tas-cas.org 18. A decision of the Single Judge of FIFA PSC (FPSD-14411) was rendered on 15 July 2024 (the “Appealed Decision”) and notified with grounds to the Parties on 16 August 2024. 19. A summary of the FIFA PSC Single Judge’s reasoning in the Appealed Decision is as follows:

  • It is undisputed that the Parties signed the Transfer Agreement and never challenged its validity, thereby clearly demonstrating their free consent to its terms. The Parties exchanged signed legal documents, confirming that the Transfer Agreement was validly concluded.
  • The amount agreed upon by the Parties was fully paid, and, according to the evidence on the TMS, the Player was registered with Botev. Moreover, Botev never requested reimbursement of the payment nor challenged the validity of the contractual terms, including the sell-on-fee clause in Article 2.1 of the Agreement.
  • Therefore, Madenat is entitled to receive 50% of the amount Botev received from S.V. Zulte Waregem regarding the Player’s transfer and registration from the latter to the Belgian club.

Given this legal reasoning, the operative part of the Appealed Decision reads: “1. The claim of the Claimant, Madenat, is accepted. 2. The Respondent, Botev Plovdiv, must pay to the Claimant the following amount:

  • EUR 125,000 as outstanding amount plus 5% interest p.a. as from 1 March 2024 until the date of effective payment.
  1. Full payment (including all applicable interest) shall be made to the bank account indicated in the enclosed Bank Account Registration Form.
  2. 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:
  3. The Respondent shall be banned from registering any new players, either nationally or internationally, until the due amount is paid. The maximum duration of the ban shall be of up to three entire and consecutive registration periods.
  4. The present matter shall be submitted, upon request, to the FIFA Disciplinary Committee in the event that full paym