Sport Luanda e Benfica FC v. Fédération Internationale de Football Association (FIFA)

V. JURISDICTION

30. Article R47 of the Code provides, inter alia, as follows:

“An appeal against the decision of a federation, association or sports-related body may be filed with CAS if the statutes or regulations of the said body so provide or if the parties have concluded a specific arbitration agreement and if the Appellant has exhausted the legal remedies available to it prior to the appeal, in accordance with the statutes or regulations of that body”.

31. The jurisdiction of the CAS derives from Articles 64.5 of the FDC and 58 of the FIFA Statutes (2016 edition).

32. The jurisdiction of the CAS was not contested by either party and is further confirmed by the Order of Procedure which was duly signed by both Parties.

VI. A DMISSIBILITY

33. Article R49 of the Code provides, inter alia, as follows:

“In the absence of a time limit set in the statutes or regulations of the federation, association or sports -related body concerned, or in a previous agreement, the time limit for appeal shall be twenty-one days from the receipt of the decision appealed against”.

34. The appeal was filed within the deadline of 21 days set by Article 58.1 of the FIFA Statutes. The appeal complied with all other requirements of Article R48 of the CAS Code.

VII. A PPLICABLE LAW

35. Article R58 of the Code provides as follows:

“The Panel shall decide the dispute according to the applicable regulations and, subsidiarily, to the rules of law chosen by the parties or, in the absence of such a choice, according to the law of the country in which the federation, association or sports-related body which has issued the challenged decision is domiciled or according to the rules of law that the Panel deems appropriate. In the latter case, the Panel shall give reasons for its

decision”.

36. Article 57.2 of the FIFA Statutes stipulates the following:

“The provisions of the CAS Code of Sports-Related Arbitration shall apply to the proceedings. CAS shall primarily apply the various regulations of FIFA and, additionally, Swiss law ”.

37. Pursuant to Article 58 of the Code and Article 57.2 of the FIFA Statutes, CAS shall, as to the substance of the appeal, apply primarily the last edition of the FDC (2011) and, subsidiarily, Swiss law, should the need arise to fill a possible gap in the various regulations of FIFA.

VIII. MERITS — A. The main issues

38. The main issues to be resolved by the Sole Arbitrator are the following:

i. Has Article 64.1 of the FDC been breached by the Appellant?

ii. Are the sanctions imposed upon Sport Luanda in breach of the principle of proportionality and/or of Article 39.4 of the FDC?

39. After having carefully analysed all the factual elements provided by the Parties and the substantive law and regulations applicable to the merits, this Sole Arbitrator considers that the appeal lodged by Sport Luanda is groundless.

i. Has article 64.1 of the FDC been breached by the Appellant?

40. First and foremost, the Sole Arbitrator notes that it remained undisputed that Sport Luanda did not lodge an appeal against the FIFA PSC decision, which was notified to the Parties on 17 March 2016.

This means that the decision became irrevocable, final and binding upon the Parties.

41. As correctly stated by the Respondent, the FIFA DC – as a FIFA sanctioning and enforcement body – lacks the competence to review the substance of final and binding FIFA PSC decisions when it imposes sanctions for the non-fulfilment of those decisions.

42. Indeed, the FIFA PSC decisions are subject to a separate appeal before the CAS in accordance with Article 58 of the FIFA Statutes. As the Sole Arbitrator notes above, no appeal against the FIFA PSC decision was filed by the Appellant before the CAS.

43. Moreover, the Sole Arbitrator further notes that, bearing in mind the function and the scope of the FIFA DC, the only task that this judicial body can carry out is to verify whether or not the

debtor has complied with the final and binding decision of the relevant body.

44. In light of the above, it is therefore important to underline that – as a general principle – the FIFA DC has to take into account only the facts arising after the date on which the decision became final and binding, as the disciplinary proceedings are designed to assess only the compliance with the final decision rendered by the relevant FIFA body. This is the scope of the FIFA disciplinary proceedings.

45. As a result, only submissions relating to the sanction imposed by the FIFA DC, such as its legal basis and quantum, can be heard by this Sole Arbitrator and the Appellant’s arguments as to the substance of the FIFA PSC decision cannot be considered.

46. As stated by the Panel in in the arbitration CAS 2008/A/1610 1:

“the object of [an] appeal cannot extend beyond the limits of a review of the disciplinary sanction imposed by the FIFA Disciplinary Committee, hence, only submissions relating to the fine imposed by the FDC, such as its legal basis and quantum, can be considered. The Panel cannot consider requests concerning the debt owed by Appellant, the issues relating thereto having been decided by the FDC decision which is final and binding”.

47. Bearing in mind these clear principles, there are some aspects that the Sole Arbitrator wishes to address.

48. First, the Sole Arbitrator finds that after the FIFA PSC decision was notified to the Parties (the decision was issued on 14 March 2016 and was notified to the Parties on 17 March 2016) there is no evidence and indeed no allegation that the Appellant completed the payments which it was obliged to make. Indeed, the communication forwarded by the Angolan Football Federation of 5 June 2016 was notified after the FIFA PSC decision had been issued and refers to events that allegedly happened before that decision was taken. Indeed, the Appellant claimed that Mr. R collected all the money due to AEL Limassol between 9 April and 20 May 2015 but, even if that circumstance would be true (since it is contested by AEL Limassol) these facts arose before the date in which the FIFA PSC decision was rendered.

49. The Sole Arbitrator wishes to note that, assuming these allegations made by the Appellant concerning the payment are correct, had they been introduced during the FIFA PSC proceedings they could have potentially had an impact on the FIFA PSC decision. However, at this particular stage those circumstances are totally irrelevant for the simple reason that they were submitted after the FIFA PSC decision became irrevocable and binding.

50. Indeed, it is worth emphasising that the Appellant decided not to participate at all in the FIFA proceedings. As a result, it was impossible for FIFA to assess the club’s position on the original claim.

51. In conclusion, the Sole Arbitrator is satisfied that the Appellant did not comply with the FIFA

PSC decision and therefore violated Article 64.1 of the FDC.

ii. Are the sanctions imposed upon Sport Luanda in breach of the principle of proportionality and/or of Article 39.4 of the FDC?

52. The Appellant requests that the sanctions imposed in the Appealed Decision (a fine of CHF 5,000 and a three-point deduction in case of non-payment) be replaced by a single fine of CHF 300, on the grounds that the sanctions are excessive.

53. The Respondent argues that the sanctions are proportionate and should be maintained.

54. From the outset, the Sole Arbitrator wishes to emphasise that, according to CAS’ well established jurisprudence, the measure of the sanction imposed by a disciplinary body in the exercise of the discretion allowed by the relevant rules, should be reviewed only when the sanction “is evidently and grossly disproportionate to the offence” 2.

55. The fine was imposed by the FIFA DC pursuant to Article 64.1 (a) of the FDC. In accordance with Article 64.1 (a) in conjunction with Article 15.2 of the FDC, the FIFA DC possesses the discretion to impose a fine within the range of CHF 300 (as the minimum) and CHF 1,000,000 (as the maximum) as it deems appropriate in the circumstances.

56. The Sole Arbitrator recalls that, in addition to the EUR 25,000 debt towards AEL Limassol, the Appellant was also ordered to pay to the Cypriot club the amount of CHF 1,000 and to FIFA a fine in the amount of CHF 5,000 and procedural costs in the amount of CHF 4,000. The amounts at stake are therefore not insignificant.

57. In this regard, the Sole Arbitrator also notes that, despite the time span that elapsed during the proceedings before the FIFA PSC and the FIFA FDC and despite the several reminders, the Appellant still has not paid all amounts that it owes. The Sole Arbitrator therefore considers that, taking into consideration the purpose of the rule in question (timely and prompt compliance with decision of FIFA bodies) the Appellant’s level of culpability in the offence at stake is therefore significant.

58. The Respondent argues that the FIFA DC did not take into account the currency exchange issues in Angola, the fact that the Appellant is a semi-amateur club and the circumstance that the Appellant has no prior offences.

59. Firstly, the Sole Arbitrator emphasises that the Appellant chose not to bring forward any of these arguments during the FIFA DC proceedings.

60. Concerning the currency exchange issues, the Sole Arbitrator notes that the Appellant limited itself to submitting a press article about the issues surrounding the Angolan currency in November 2015, as well as an indication of the exchange rate in December 2016, but has failed

2 See, for example, CAS 2007/A/1217, para 12.4.

to establish exactly how those circumstances would have affected the Appellant to such a degree that it should lead to a conclusion that the fine is grossly disproportionate as a result. In any event, the Sole Arbitrator is of the view that the fact that the conjuncture of a given country at a certain point in time may cause additional difficulties in complying with a sanction does not necessarily mean that said sanction is disproportional.

61. In relation to the alleged semi-amateur status of the Appellant, again the Sole Arbitrator wishes to note that the Appellant has failed to specify exactly and in practice how this circumstance (even if correct) would imply the gross disproportionality of the imposed sanction.

62. Concerning the absence of a disciplinary record, the Sole Arbitrator is of the view that stakeholders are expected to comply with the applicable rules. The absence of a disciplinary record should, in the Sole Arbitrator’s view, be more a reason not to increase the sanction due to the absence of aggravating circumstances than a reason to reduce it due to the existence of mitigating ones. Abiding by the rules should be the norm.

63. In light of the above and particularly considering the range of fines and other sanctions that could have potentially been imposed, the Sole Arbitrator considers that the fine of CHF 5,000 does not seem to be oppressive and appears to be justified by the attitude of the Appellant who has failed to timely comply with its payment obligations towards the Cypriot Club and towards FIFA.

64. Indeed, the amount of CHF 5,000 as determined by the Appealed Decision cannot be said to be disproportional in light of the purpose for which it was imposed and considering the amounts owed by the Appellant. The rationale of the fine is to serve as a deterrent to parties who decide not to comply with decisions of FIFA bodies.

65. Therefore, in view of the Appellant’s non-compliance with the FIFA PSC Decision, the Sole Arbitrator holds that the preconditions for the fine to be imposed on the Appellant by the FIFA DC had been met and that the fine is not excessive. Likewise, for the reasons set out above, the Sole Arbitrator holds that it has not been established that the Respondent breached Article 39.4 of the FDC when imposing the sanctions.

66. The Sole Arbitrator takes comfort in the information presented by the Respondent as to sanctions imposed upon clubs in the context of other disciplinary proceedings, which appears to demonstrate that there is a certain consistency in the application of sanctions to offences of similar level as that for which the Appellant has been sanctioned.

67. As far as the three-point deduction in case of persistent non-payment is concerned, the Sole Arbitrator notes that it is fully in the hands of the party subject to a threat of point deduction to avoid its enforcement. All that is required is the timely payment of the outstanding debt. The Sole Arbitrator therefore finds this to constitute an additional reason not to consider the imposed sanctions as disproportional, let alone grossly disproportional.

68. Finally, for the sake of completeness, the Sole Arbitrator wishes to note that, even if the

Appellant had paid any of the amounts due after the Appealed Decision was issued, it does not appear that the imposed sanctions could be reduced on that basis. Indeed, Article 64 of the FDC cannot be interpreted as meaning that a fine imposed by the FIFA DC may be subject to a later reduction or abatement if the outstanding payment is finally made, however late it may be.

69. In this regard, this Sole Arbitrator fully agrees with the grounds of another CAS award which, inter alia, reads as follows: “Whether a substantially late payment may serve to reduce a DC fine is also a question of policy. In this respect the Panel fully embraces the submission of FIFA, i.e. if the Appellant’s late payment were accepted as “mitigating circumstances” to reduce the fine, this would provoke a trend for debtors to disrespect the decisions of the DRC or other FIFA bodies and to only pay prior to the rendering of the CAS’ decision in the appeal proceedings on the fine. Debtors would then become reliant on the later reduction of fines imposed by the DC. This would somehow undermine the dispute resolution and enforcement system as set out by the FIFA Statutes and Article 64 of the FDC. This Panel holds that this cannot have been the intention of the drafters of Article 64 of the FDC” (CAS 2010/A/2148, para. 5.21).

B. Conclusion

70. Based on the foregoing, the Sole Arbitrator holds that:

i. The Appellant’s behaviour was in breach of Article 64.1 of the FDC;

ii. The sanctions imposed on Sport Luanda e Benfica FC are in compliance with the principle of proportionality and were not imposed in breach of Article 39.4 of the FDC.