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MAY 4, 1998

FIA to sue European Commission

THE International Automobile Federation and Formula 1 boss Bernie Ecclestone are reported to be planning to take legal action against the European Commission and its Competition Commissioner Karel Van Miert. The reports in the German newspaper Spiegel say that the FIA and Ecclestone are seeking nearly $900m in damages which result from the EU's intervention in Ecclestone's plans to float Formula 1 Holdings.

According to the German newspaper Spiegel, FIA President Max Mosley will open proceedings formally this week at the European Court of Justice in Luxembourg, asking for $300m in damages for the EU's meddling and damage caused to the reputation of the FIA. Mosley is also expected to institute an action against Van Miert himself for public comments the Competition Commissioner made. Spiegel said that Ecclestone is expected to begin an independent but connected law suit seeking $600m in damages.

Ecclestone submitted his plans to the Commission in September last year but in December Van Miert announced that the FIA and Ecclestone were abusing a monopoly situation and that he would be taking action against them. Nothing has happened since and Ecclestone's plans to float Formula 1 Holdings remain in limbo which has frustrated Ecclestone and the FIA, which stands to gain considerable money from the flotation. The FIA is already planning to move its headquarters out of the EuropeanÊUnion to Switzerland to avoid having to answer to Brussels.

The intention of legal action against the European Union seems to be to force the issue and remove the block on the flotation which Van Miert is causing.