JULY 3, 2000
Ecclestone lands commercial rights to F1 for 100 years
BERNIE ECCLESTONE has pulled off an amazing new deal with the FIA to exploit the commercial rights of the Formula 1 World Championship for the next 100 years. Ecclestone is understood to be paying the FIA a total of $360m. Of this $60m is a lump sum payment at the start of the deal. This will enable the governing body to establish itself in suitable new offices, to fund important research programs and to make investments so that the organization will continue to be properly funded. In addition there will be an annual payment of $3m. This means that the governing body will be able to remain a non-profit-making organization under French law and so will return to Paris in the months ahead. The FIA has cleared the way for the move by settling its taxation dispute with the French government. Rather than returning to its offices in the Automobile Club de France, the FIA will move into another building on the Place de la Concorde, our spies tell us that this will be on the opposite side of the square. The FIA will also have a new office in Britain. This is expected to be at the Biggin Hill aerodrome (the headquarters of Bernie Ecclestone's television business) where the FIA will rent a small block of offices which will house FIA Race Director Charlie Whiting and his staff.
The 100-year deal for commercial rights to the World Championship has, apparently, been accepted by the European Commission Competition Directorate as it is so long a deal that it cannot be considered anti-competitive as it is, in effect, the same as an outright sale.
The FIA General Assembly would not accept a deal to lease the entire World Championship to Ecclestone but agreed to an extension of the commercial rights deal. As a result the governing body will continue to supply the administrative and legislative services for Formula 1.
It remains to be seen how the deal will work with the Formula 1 teams as the current Concorde Agreement runs only until the end of 2007. At the moment the Concorde Agreement has 14 signatories: the FIA, Ecclestone and the 12 contracted teams. The FIA does not need to be involved in the future but Ecclestone will need to get the agreement of everyone else and the teams are likely to complain that they do not receive enough of the income from the sale of television rights - as they get only 47% of the money that comes in.
The problem for Bernie is that the teams are being taken over by big motor manufacturers and they cannot be swayed as much as small teams and so he may need to renegotiate the split. With the current Concorde Agreement being relatively short he will probably need to get agreement for a new longer-term Concorde Agreement before he can finally float Formula One Administration on the stock exchanges.
|Print News Story|
ECCLESTONE LANDS COMMERCIAL RIGHTS TO F1 FOR 100 YEARS
HONDA TO GIVE JORDAN FACTORY V10S
JEAN-JACQUES HIS RETURNING TO RENAULT SPORT
MCLAREN AND FERRARI RIVALRY SET TO CONTINUE IN TESTING
MCLAREN CONFIRMS HAKKINEN AND COULTHARD FOR 2001
PEUGEOT DECIDES TO STAY IN F1
THE DRIVER MARKET BEGINS TO MOVE
TOYOTA'S LATEST PLANS
VILLENEUVE AND BUTTON AT BENETTON?