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2006 Football Transfer Partially Upheld English Appeal Procedure

Parties & Representatives

Appellant: Hertha BSC Berlin
Appellant Representative: Joachim Rain
Respondent Representative: Sophie Dion

Arbitrators

President: Peter Leaver

Decision Information

Decision Date: December 1, 2006

Case Summary

The case involves a dispute between Hertha BSC Berlin and Stade Lavallois Mayenne FC over training compensation for a Cameroonian football player, T., who moved from Hertha to Stade Lavallois. The Court of Arbitration for Sport (CAS) was tasked with resolving Hertha's appeal after the FIFA Dispute Resolution Chamber (DRC) rejected their claim for €320,000 in training compensation. The central legal issue revolved around the interpretation of FIFA regulations, particularly concerning compensation rules for players moving within the EU/EEA, regardless of nationality, as long as they were lawfully present and entitled to work in the region. The CAS panel emphasized that FIFA regulations take precedence over circulars, which cannot amend or expand regulations without explicit authority. The panel noted that training compensation is generally owed by the new club to the training club, unless the training club's actions, such as not offering a contract, affect the amount. T. had initially signed a training contract with Hertha in 1999 and a professional contract in 2001. After being demoted to the reserve team in 2003, T. sought an early termination of his contract, which Hertha agreed to in 2004, allowing him to join Stade Lavallois without a transfer fee. Hertha later claimed compensation for T.'s training, but the DRC ruled against them, stating that the mutual termination of the contract precluded such a claim. Hertha appealed to CAS, arguing that the DRC misapplied FIFA regulations. The CAS panel reviewed the facts and applicable law, including FIFA regulations and Swiss law, given the absence of a specific agreement between the parties. The panel found that the DRC's decision lacked clarity regarding the evidence supporting its conclusion that the termination was solely for the transfer. The panel upheld the principle that training compensation is generally due unless specific exceptions apply but did not overturn the DRC's decision in this instance. The case highlights the complexities of interpreting FIFA regulations and the balance between administrative circulars and formal rules in sports arbitration. The CAS panel ultimately ruled that Hertha was prima facie entitled to training compensation but reduced the amount to €80,000, considering the circumstances of the mutual termination and the lack of evidence on Hertha's training costs. The panel dismissed Stade Lavallois' counterclaim, finding no evidence of bad faith or abuse of process by Hertha. The final ruling partially allowed Hertha's appeal, overturning the DRC's decision and ordering Stade Lavallois to pay €80,000 in training compensation. The case underscores the importance of proportionality in training compensation disputes and the need for clear evidence when disputing such claims.

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