Cardiff city fail to pay medel solidarity transfer payment

Tuesday 26th November 2013.

A top Chilean soccer team’s dispute with English Premier League newcomer Cardiff City is highlighting the difficulties Latin American clubs can have in getting paid for developing young talent.

Lawyers for publicly traded Universidad Catolica (CRUZADOS) said the Welsh club failed to pay about 500,000 euros ($675,000) in compensation for record signing Gary Medel within the 30 days mandated by soccer’s governing body. Cardiff, which will earn at least 60 million pounds ($97 million) in television income from its first season in England’s top league, could have been reported to FIFA.

The 26-year-old midfielder joined Cardiff for 11 million euros from Spain’s Sevilla in August, and under FIFA regulations Santiago-based Catolica is owed a fraction of the fee in “solidarity” payments because he trained there as a youth. Cardiff hadn’t responded to Catolica’s request until contacted by Bloomberg News on Nov. 22, almost three months after Catolica first approached Cardiff, according to Eduardo Carlezzo, the lawyer representing Catolica.

“In the last days we received a reply from Cardiff and agreed on the amount due to Universidad Catolica,” Sao Paulo, Brazil-based Carlezzo said in an e-mailed statement yesterday. “Now we are confident that during this week a final deal with Cardiff may be reached and the claim with FIFA definitely avoided.”
Cardiff, which last weekend drew 2-2 with English champion Manchester United, yesterday said it had had “very positive conversations” with representatives of Catolica and agreed on the figure payable to them.
Solidarity Cash
“We are awaiting their invoice and bank details so that the monies can be paid to them,” the British club said in an e-mailed statement. “As and when this happens we can complete things.”
Catolica said in a separate statement that “the matter will be definitively closed” once it’s been paid.
Solidarity payments accounted for 1 percent, or 23.2 million euros, of global transfer fees in 2011, according to a report by Brussels-based consulting firm KEA European Affairs, citing FIFA data. The payments can make up 5 percent of all fees, meaning there was a shortfall of up to 93 million euros in 2011, according to Bloomberg News calculations.
FIFA regulations call for buying clubs to distribute the solidarity payment to teams the player was registered with between the age of 12 and 23. Medel was with Catolica between January 1999 and July 2009. Carlezzo said Cardiff had agreed in principle to pay about 500,000 euros. Catolica made a loss of 742 million pesos ($1.4 million) on sales of 7.45 billion pesos in 2012.
‘Ignore Payments’
Clubs in South America and Africa are starting to chase payments they weren’t aware they were owed or which they didn’t have the resources to pursue, according to Raffaele Poli, a researcher at the International Center for Sports Studies in Neuchatel, Switzerland.
“It has been a strategy of buying clubs to ignore payments until just before the case” goes to the Court of Arbitration for Sport in Lausanne, Switzerland, he said. “This has been happening on a large scale” and it can take “two or three years” for cases to go to the tribunal.
There are now at least six lawyers in countries including Switzerland, Argentina and Ivory Coast who specialize in approaching clubs to chase payments in return for a share of any receipts, Poli said. Clubs are also using a recruitment database called Scout7 to better track the career of former players.
Carlezzo said his firm, Carlezzo Advogados Associados, has represented clubs in eight countries in about 500 cases related to solidarity payments over the past decade.
Chile Victory
“I have been personally been involved in cases where the training clubs were so small that they didn’t have a banking account to receive the solidarity contribution,” the lawyer said. “So, you can imagine how important the amount received was for those clubs, in some cases more than their annual revenue.”
Catolica, known for developing local talent, leads the Chilean league this season. In the national team’s 2-0 victory over England at Wembley Stadium on Nov. 15 eight of the squad had been on the team’s books, including Mauricio Isla of Juventus and Wigan’s Jean Beausejour, according to Carlezzo.
“Universidad Catolica is one of the biggest football clubs in Chile and is responsible for the training and development of several high-level players,” he said. “Therefore, the amount due from Cardiff is very important for the club since a good part of that is reinvested in the academy.”

Could this be something to do with why moody was sacked?

critical line for me is this - waiting for an invoice and bank details - I don't know any organisation private or public in the UK who would pay anything to anyone without an invoice and bank details if required.

ffs

All the Tan out muppets will find a way of blaming him. Another monumental crisis rocks the city.

Not quite the same as the Motherwell incident is it!?

Seems as if something has gone a miss with this situation. Some dotting of i's and crossing of t's have been overlooked. A costly mistake for anyone to make. Hmmmmmm