There are situations where a player wants to leave a club or a club wants to break up with a player during the middle of the season. Before the contract between the player and the club expires. For whatever reason. That’s part of the business. To make such a separation as painless as possible and to ensure each party to the contract fulfills its obligations, the parties sign a Settlement agreement for the early termination of the player – club contract.
Essential legal points of the Settlement agreement for the premature termination of the player-club contract.
1. Parties of the Settlement
[…] hereinafter – the Player
[…] hereinafter – the Club
2. The object of the Settlement Agreement
[…]
It is critical to indicate which exactly agreement or contract parties are terminating by signing this Settlement Agreement. Additionally, to include all annexes and other documents that are connected to the main agreement.
3. Terms
[…]
The day the Settlement agreement enters into force.
4. Obligations of the Club
[…]
Amount of compensation for the early termination.
Schedule of payment
Taxes on payment
Letter of clearance
The club has no further duties and obligations towards the player.
5. Obligations of the Player
[…]
To return a car/apartment and other goods that were given to the player while he/she was under contract with the club.
The player has no further obligations to the club.
6. Schedule of payments
[…]
7. Sanctions
[…]
Sanctions for delayed payments due.
Sanctions for violation of the confidentiality clause.
8. Confidentiality
[…]
9. Applicable law
I advise my clients to include the BAT Clause. Basketball Arbitral Tribunal (BAT) is an international dispute solving institution recognized by FIBA ( https://www.fiba.basketball/bat )
For any disputes to be admissible to BAT, the following arbitration clause must appear in a contractual agreement:
“Any dispute arising from or related to the present contract shall be submitted to the Basketball Arbitral Tribunal (BAT) in Geneva, Switzerland and shall be resolved in accordance with the BAT Arbitration Rules by a single arbitrator appointed by the BAT President. The seat of the arbitration shall be Geneva, Switzerland. The arbitration shall be governed by Chapter 12 of the Swiss Act on Private International Law, irrespective of the parties’ domicile. The language of the arbitration shall be English. The arbitrator shall decide the dispute ex aequo et bono.” (BAT Arbitration Rules, point 0.3)
10. Miscellaneous
[…]
11. Parties and signatures
[…]
NOTE!
In some countries, due to rules of the local basketball federations, players and clubs sign two agreements: 1) so-called “federation employment agreement” based on local laws; 2) so-called “FIBA contract”, or “International contract” based on FIBA rules. The second contract includes the BAT clause and is usually considered the principal agreement between the parties.
If two contracts were signed, both local and international agreements must be terminated at the same time.
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