The Court of Arbitration for Sport (CAS) ruled on a dispute between Genoa Cricket and Football Club (Genoa CFC) and GNK Dinamo Zagreb concerning the interpretation of a sell-on clause in a football player transfer agreement. The case originated from a 2013 transfer where Dinamo Zagreb sold a player to Genoa for €4,000,000, with additional variable payments tied to the player’s appearances. The agreement stipulated that if the player was later transferred for more than €4,000,000, the variable amounts would become due. In 2014, Genoa transferred the player to Sassuolo for €3,500,000, with performance bonuses of €1,000,000. Dinamo Zagreb argued that the total compensation (€4,500,000) exceeded the threshold, triggering the sell-on clause, and filed a claim with FIFA’s Players’ Status Committee (PSC) in 2016. The PSC ruled in Dinamo Zagreb’s favor, ordering Genoa to pay €1,000,000 plus interest. Genoa appealed to CAS, contesting the interpretation of the clause, arguing that only the fixed transfer fee should count toward the threshold.
The CAS panel, applying Swiss law and principles of contractual interpretation, emphasized the importance of the parties' common intention and the agreement’s wording. It noted that sell-on clauses are standard in football transfers, designed to protect selling clubs if a player’s value increases. The panel concluded that "total transfer compensation" included both fixed and variable amounts, as this reflected common practice and the agreement’s intent. Since the total compensation from Sassuolo (€4,500,000) exceeded €4,000,000, the sell-on clause was triggered, obligating Genoa to pay Dinamo Zagreb the additional €1,000,000. The panel upheld the PSC’s decision, dismissing Genoa’s appeal and reinforcing the principle of pacta sunt servanda (agreements must be honored). The ruling highlighted the need for clear contractual terms and adherence to common practices in football transfers, ensuring fairness and predictability in such disputes. The decision also underscored the CAS’s role in resolving complex contractual disagreements in sports, balancing legal principles with industry standards.