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MARCH 28, 2002

Can the FIA be challenged in court?

THE issues raised by the Phoenix Finance Ltd. bid to take over some of the assets of Prost Grand Prix are interesting and raise the question of whether or not the FIA can be challenged for any decisions it makes. On the one hand this is very clear: the FIA is a club in which competitors are members and they accept the regulations as they are and thus cannot challenge them in civil courts. This principal has been established with a series of legal actions, notably a case in Hamburg in 1969. Eleven years later the federation was faced with a challenge to its sovereignty when no less a figure than Bernie Ecclestone (then representing FOCA) talked about opening "the whole can of worms in auto racing worldwide over the legal status of the governing body". A few weeks later Max Mosley, then the FOCA legal advisor, announced the foundation of the World Federation of Motor Sport - a rival governing body to the FIA.

This powerful challenge came to nothing because Mosley and Ecclestone realized that they could do nothing to beat the FIA boss Jean-Marie Balestre and so a compromise - known as the Concorde Agreement - was reached in March 1981. This established a way to settle disputes between the signatories and the only challenges to the FIA power in relation to F1 after that came from Tyrrell in 1984, which tried (and failed) to stop itself being thrown out of the World Championship, and in 1985 when the Automobile Club de Monaco tried to force the FIA to annul its decision to kick the Monaco GP out of the World Championship.

Where there is a "grey area" is when there are commercial implications of an FIA decision. Peugeot challenged the FIA over the decision to ban Group B rallying and the French firm won the case but then lost the victory after an FIA appeal.

Ecclestone touched on this is 1980 when he accused the federation of being "contrary to the anti-trust laws in the United States, the equivalent provisions of the Treaty of Rome and similar legislation elsewhere." The irony of these comments was that in recent times Ecclestone and the FIA (under Mosley) have spent several years fighting with the European Commission over the line that must be drawn between sport and business. This process has now been completed and the European Commission has ruled that the FIA's rules and regulations are now acceptable. This most recent ruling is really the nail in the coffin of anyone wanting to challenge the FIA from a legal standpoint. The federation has its International Court of Appeal (which the European Union says it is happy with) and the signatories of the Concorde Agreement have a system of arbitration at the International Chamber of Commerce in Lausanne. This leaves limited room for legal action.