CAS UPHOLDS FIFA’S JURISDICTION OVERRIDING SAUDI ARBITRATION CLAUSE

We are pleased to share that our client, a Serbian footballer, has succeeded in a dispute with a Saudi club. In addition to the common legal issues of unilateral termination and damage compensation, the case revolved around the jurisdiction.

Despite the contractual reference to the Saudi Sports Arbitration Center (SSAC), the Player filed a claim at FIFA, contending that the SSAC failed to meet the requirements set out by FIFA (the Minimum DRC standards). In response to the Player’s claim, the Club filed a counterclaim against both the Player and his new club. The designation of the new club is pertinent to the Club’s objection regarding jurisdiction.

However, given that the Club did not provide any documentary evidence on the basis of which it could be concluded that the SSAC would be compliant with the minimum procedural standards, FIFA ruled in favor of its own jurisdiction. Concurrently, FIFA upheld the Player’s claim and rejected the Club’s counterclaim, prompting the Club to lodge an appeal with CAS.

During the CAS appeal procedure, the Parties extensively presented arguments on the matter. Ultimately, CAS determined that the Club failed to prove that the SSAC was compliant with the Minimum DRC standards. The Award states that, most significantly, the Sole Arbitrator was not comfortably satisfied that the SSAC arbitrators’ list satisfied the principle of parity. This wording suggests that, while the lack of the parity principle was a prominent concern, there are other factors contributing to the SSAC’s non-compliance with the standards.

Other (additional) arguments against the SSAC can be summarized as follows:

– the actual national dispute resolution chamber (NDRC) within the Saudi Arabian Football Federation (SAFF) and the SSAC are two totally different bodies, with different scope of jurisdiction (both ratione personae and ratione materiae), established by different entities and operated by different individuals. The NDRC operates as a part of the SAFF, whereas the SSAC functions as a separate arbitral institution and the relationship between the SSAC and SAFF is mirroring the relationship between CAS and FIFA.

– arbitral clause in favor of the SSAC is incompatible with Article 22, para. 1, lit. (b) of the FIFA Regulations on Status and Transfer of Players (RSTP), given that the SSAC is as an arbitral institution outside the SAFF framework.

– In the KSA, workers are prohibited from joining trade unions or participating in strikes, which renders it impossible for the NDRC to adhere to any aspect of the parity principle (in this context, a substantial involvement from FIFPRO could be instrumental).

– [presumably because of the foregoing] the rules adopted by the SAFF exclude international disputes from the competence of the NDRC.

– as to the SSAC, it is worth mentioning that does not align with the necessary standards on (1) challenge/removal procedure (the SSAC Board, devoid of player representation, decides on the challenge/removal); (2) right to appeal (the SSAC decisions are final and binding); (3) access to justice (the SSAC Board holds the authority to establish fees for each case without a specified scale, while the SSAC procedural rules do not mention legal aid).

*For the sake of clarification, the foregoing arguments were based on translation of the relevant documents that were in force in December 2022.

Another interesting topic that remained unanswered was whether the act of filing a counterclaim before FIFA in an unconditional manner – where the requests for relief lack clarity on the counterclaim being an alternative or subsidiary request, contingent on the rejection of the jurisdictional objection – impedes the possibility of challenging FIFA’s jurisdiction. In this context, a (counter)claim against a player pursuant to Article 17.1 and 17.2 of the RSTP is procedurally distinguished from a claim against his new club arising from the same facts and provisions. Consequently, when disputing FIFA’s jurisdiction, clubs are not compelled to initiate a (counter)claim against their former players before FIFA (instead, they have the option to file a claim only against the new club before FIFA, nonetheless, this could pose practical complications). However, should they opt to also bring a claim against a player before FIFA, it appears unavoidable that their jurisdictional objection will be rejected.