European Union Urged To Investigate Formula 1’s Billion-Dollar Finances

Which big teams will quit F1 if their payout is cut in half?

F1 will be put in the dock as a "demand to investigate" the sport's $1.57B finances is handed to the European Union, according to Kevin Eason of the London Times.

South East England MEP Anneliese Dodds has written to EU Competition Commissioner Margrethe Vestager over "grave concerns" about the way that the sport is run. Her request comes after the delivery of a "potentially explosive dossier outlining the secretive and complex world of the sport's finances."

Dodds: "There was an agreement made between F1 and the European Union about competition some years ago and it seems that has not been stuck to. There does not seem to be true competition in the sport and the fears are not just for jobs, but for technology and the profile of the sport."

An investigation by the EU's competition commission would "put F1's finances on hold and sink the plans" of CVC Capital Partners, the sport's private equity group owner, for a "lucrative multibillion-dollar payday by floating the business on the Singapore Stock Exchange."

A dossier was reportedly handed in to Brussels in June "but has been awaiting the arrival of Vestager to take up her new post."

It provides "intimate detail, most of it not in the public domain, and outlined worries that F1 operates as a cartel." The evidence handed to Brussels revolves around the "setting up of the strategy group, comprising McLaren, Ferrari, Red Bull, Mercedes and Williams."

The group controls the "decision-making in F1; the strategy group teams also take home" the bulk of the $900M handed out by Ecclestone to the teams. The FIA will also be drawn into "any investigation as doubts persist over the legality of its relationship with Ecclestone's F1."

The FIA settled for a "staggering" $250M deal with Ecclestone under the terms of a new Concorde Agreement, the tripartite contract, which runs until '20, between the F1 business, the teams and the FIA. As well as the $5M "sweetener" to sign, the FIA was handed a 1% shareholding in the F1 company for a cut price of about £286,000. That alone could be worth $116.2M London Times