In a joint release by Sahara Force India and Alfa Romeo Sauber F1, both teams have decided to drop the complaint they had lodged with the European Commission back in 2015. The complaint was centered around the fair and equitable distribution of prize money that currently is heavily weighted to Ferrari, Mercedes, Red Bull, McLaren and Williams.
The teams were not happy with the payment structure and labeled it as “unfair and unlawful”. IT seems with new owners of F1, the teams now find Liberty Media a more agreeable partner:
Joint release by Sahara Force India and the Alfa Romeo Sauber F1 Team:
We have decided to withdraw the complaint we lodged with the European Commission in 2015 on the subject of anti-competitive practices in the sport of Formula 1.
We have been greatly encouraged by the dialogue that has been introduced following the appointment of Chase Carey as Executive Chairman and CEO of the Formula 1 commercial rights holder and his new management team. Their approach has brought a new culture of transparency to the sport and illustrates willingness to debate fundamental issues such as the distribution of the prize fund monies, cost control and engine regulations.
We are encouraged and reassured by the even-handed and fair negotiating approach taken by the new management of Formula 1 to all the teams and their issues.
While the concerns leading to the compliant were fully justified, we believe this new approach provides the necessary degree of assurance that our concerns will be looked at objectively, and we prefer to resolve the issues facing the sport through dialogue rather than a legal dispute.
We want to support this transformational process in Formula 1 and thus have resolved to withdraw our complaint with immediate effect.
It’s good news that Chase Carey can take this issue off his “to-do” list of litigious battles and that he’s been willing to engage the smaller teams on the grounds of a possible payment restructure and that is more equitable for them.
I am curious how Chase will achieve this as the big teams are contractually due these special payments. Certainly there is a pot of money with revenue generated by race sanctioning fees, broadcast rights and other revenue streams. The challenge is how this is all divided up between teams and Formula One Management. F1’s new owners are keen to spend more on marketing with events like London Live and other fan-centered concepts and this costs money reducing profit.
Then there is the concept of the big teams losing these special payments. How will they react to losing the lion’s share based upon the amount they spend in the sport and their legacy? I don’t envy Chase’s job but I have to say kudos to him for getting this lengthy and litigious issue off the table.